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    Kazakhstan expands domestic gas sales: press

Summary

Exports will be scaled back to compensate.

by: Callum Cyrus

Posted in:

Complimentary, Natural Gas & LNG News, Asia/Oceania, News By Country, Kazakhstan

Kazakhstan expands domestic gas sales: press

Kazakhstan will transfer 2bn mof its gas production capacity at Chevron-operated Tengiz from exports to domestic sales, Reuters reported June 9.

The move is the personal initiative of Kazakhstan's president Kassym-Jomart Tokayev. China is Kazakstan's main gas customer, and it is unclear whether the directive will impact Chinese sales, or trade balances with Russia.

Kazakh exports are declining due to fluctuations in Chinese demand, but also because economic growth has spurred greater local consumption. Reuters says that in 2021, Kazakhstan delivered 6bn m3 of gas to China, and 1 bn m3 to Russia.

The IOC investor community appears divided on the potential of Kazakhstan's offshore Caspian Sea basins. Russia's Lukoil is expanding its presence, having in October 2021 closed on the purchase of nearly 50% interest in the Al-Farabi oil and gas project. On the other hand, BP decided against proceeding with three Kazakh Caspian upstream projects in March 2021. The UK major felt the projects did not align with the shift in its strategy towards renewables, but it had also sold its stake at Tengiz to Lukoil in 2009.