Oil refining in Kazakhstan should be taken over by state - newspaper

energy

Oil refining in Kazakhstan should be taken over by state - newspaper

By SRI ⋅ July 30, 2008 ⋅

(SRI) - Oil refining in Kazakhstan should be taken under state control in order to stabilize the situation on the domestic market for refined petrolum products, according to a government official.

The chairman of inter-regional inspection of Agency for Competition Protection of Akmola and Karaganda oblasts and Astana city, Abdykarim Abjanov, informed on Monday, the agency reports to the newspaper Time.

An analysis conducted by the Agency for Competition Protection of Akmola and Karaganda oblasts and Astana city has shown that Kazakh refineries cannot produce the necessary amount of fuel needed for the country, and suppliers are compelled to buy petroleum products abroad at higher price, Abdykarim Abzhanov, the chairman of the agency, said in an interview with the newspaper Vremya.

According to Mazhit Koyatdinov, an economic analysts, the situation on the domestic market will stabilize only when oil refinineries are able to satisfy internal demand. “It will happen in three or four years when construction of new oil refining factories is finished,” the analyst said.

There are only three oil refineries in Kazakhstan and one of them, The Pavlodar refinery, is currently not operating due to scheduled maintenance. The share of import fuel in home market totals about 45 percent. The Atyrau oil refining factory will be under reconstruction soon, after which the share of import of petroleum products will increase up to 60-65 percent leading to an increase in the price of fuel.

According to M. Koyatdinov, the government can constrain increase of prices of fuel for maximum two months.

Earlier, the Minister of Energy and Mineral Resources of Kazakhstan Sauat Mynbayev urged domestic oil producers to increase supplies of crude to domestic refineries to satisfy domestic demand for refined petroleum products.