Kazgeology and KazMunayGas signed a cooperation agreement

The Ministry of Ecology, Geology and Natural Resources of the Republic of Kazakhstan, JSC “National Company “KazMunayGas” and JSC “National Geological Exploration Company “Kazgeology” signed a cooperation agreement in the field of improvement of the geological knowledge of the country.

Thus, the parties plan to consolidate efforts to attract investors for geological exploration in order to assess hydrocarbon reserves in the poorly studied sedimentary basins of Kazakhstan. The relevance of the activities is due to the fact that the subsoil of Kazakhstan is not fully studied today and there are significant prospects for new discoveries. For example, in terms of hydrocarbons, geologists have identified 15 sedimentary basins with estimated conventional fuel resources of about 76 billion tons, of which, according to preliminary estimates, about 4.5 billion tons are in poorly studied sedimentary basins.

According to Magzum Mirzagaliyev, the signing of the agreement contributes to the further development of the industry.

“The Ministry continues to actively carry out work within the framework of fulfilling the instructions of the President and the Government to increase the geological knowledge of the country and replenish the mineral resource base by attracting foreign investment. The agreement will give a new impetus to this work”, – emphasized the Minister.

In order to achieve a successful result, the agreement will determine the territories for geological study and exploration, “Road show” and access to the “Data Room” are organized, as well as appropriate documents are adopted for further obtain of the right to subsurface use.

It should be noted that these measures were the implementation of the instructions of the Head of State, given following a working meeting with the heads of oil and gas companies-members of the Council of Foreign Investors. At that time, the Ministry put forward a number of important initiatives to improve the investment attractiveness and develop the exploration industry.

As a result, together with the members of the Council of Foreign Investors, a conceptual approach was formed based on the development and application of an Agreement on geological Exploration of the Subsurface, which will be used as a tool for conducting direct negotiations for a guaranteed transition from geological exploration of the subsurface to exploration/production with the participation of national companies.

This approach will provide investors with higher legal protection and investment stability, as well as allow them to receive certain tax and other preferences, which will be reflected in the Improved model contract in the future.