Print
KAZMUNAIGAZ: KAZAKHSTAN’S NOC
National oil companies (NOC’s) are playing a growing role in the global energy market. Although far smaller than the seven NOC giants, the size of Kazakhstan’s oil and gas reserves alone make Kazakhstan’s national oil company, Kazmunaigaz (KMG), a worthy topic of study for anyone interested in the NOC’s development. While estimates of Kazakhstan’s hydrocarbon reserves vary significantly, at minimum they are as large as those of Algeria, and at maximum could be equal to those of Libya, making it a potential producer of considerable influence.
When Kashagan and Tengizchevroil reach full production in the middle of the next decade, it hopes to produce over 3 million barrels of oil a day, making it a larger producer than Norway, and just behind Mexico and Iran. Even today Kazakhstan is an oil producer of consequence, producing 1.29 million barrels a day. And virtually anyone interested in investing in Kazakhstan is forced to work, in one form or another, with NC KMG.
KazMunaiGaz is very much a work in progress; one of the world’s youngest national oil companies, it could turn into something of a model for other evolving national oil and gas countries, especially those in the former U.S.S.R.. This is one of the goals of Kazakhstan’s government, which would like NC KMG to become a Central Asian version of Statoil, the Norwegian national oil company, and Kazakhstan’s National Fund, which receives a large portion of the national share of the country’s oil income, is directly modeled after the Norwegian fund.
Nonetheless, NC KMG has some features in common with other NOC’s formed in post-Soviet states, such as Russia, Azerbaijan, and Turkmenistan. But the Kazakh government has defined a much more aggressive developmental mission for NC KMG than has the Azerbaijani government for SOCAR, and certainly than the Niyazov government did for the various iterations of its national oil and gas companies.
