October 31, 2016, the expert workshop “Local Content Development and Integration Processes” organized by KAZENERGY Association jointly with the World Petroleum Council (WPC) was held in Astana

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Tuesday, 01 November 2016 18:33

LOCAL CONTENT DEVELOPMENT AND INTEGRATION PROCESSES

 

 

October 31, 2016, the expert workshop “Local Content Development and Integration Processes” organized by KAZENERGY Association jointly with the World Petroleum Council (WPC) was held in Astana

 

The extended meeting was attended by the representatives of ministries, agencies, national and international companies, industry associations etc. Joseph Tot, the President of the World Petroleum Council, Dzhambulat Sarsenov, Deputy Chairman of KAZENERGY Association, Special Advisor to the WPC President presented their welcome speeches at the opening ceremony.

The agenda was devoted to the review of the relevant issues of the local content development with analysis of experience of Kazakhstan and foreign countries. Special attention was paid to the problematic issues  in this field and in creating of the competitive market from the perspective of the national manufacturers. What measures are taken to protect the national manufacturers in our country and what is the current situation, taking into account the accession to the WTO and EEU? In the part of the legal framework, the experts discussed – the Subsoil Code, public regulation of procurements, technical regulation, elaboration of standards and certificates, as well as the themes of employment, professional skills development, database use, the tools for the local content development are considered. Saken Shakirov, Deputy Director of the Subsoil Use Department of the Ministry of Energy of RK, noted in his report: ”In 2015, Kazakhstan became the legitimate 162nd member of the WTO and EEU, having thus strengthened its positions in the world arena. It is apparent that in terms of the integration processes it is impossible to apply measures of stimulating the domestic producers and suppliers only by forcing subsoil users to purchase their goods and services. Therefore, it is necessary to introduce the alternative measures to support the domestic producers, which in our opinion, should be reflected in the Code on Subsoil and Subsoil Use. In particular, public regulation of procurements of subsoil users, which is an integral tool for the local content development and thus not contradicting the WTO’s requirements, should be saved and adopted for the existing realities”. At the interactive panel, the subsoil users, including one of the leading companies Tengizchevroil – Tengiz field operator - shared their opinions and experience. According to TCO’s data, currently for  the local content  on the Future Growth Projects (FGP) and the Wellhead Pressure Management Project (WPMP) were spent 1,3 bn. USD. Such international corporations as Shell and MOL Group have significant liabilities in Kazakhstan. They emphasis the activity targeted at the Kazakhstani content development by building interaction between the government, oil and gas operators and goods and services suppliers. In this case, Shell follows the “Win-Win” strategy. Within this, training of the local specialists, conducting of the trainings, courses, orkshops  etc. play the main role for investors.

            Over the independence years, the serious work was performed in the Republic of Kazakhstan on the local content development, however, as per today, the volume of production and procurement of the local goods, works and services is insignificant compared with the imported volumes. Since 2010-2015, the local content share in subsoil users procurements increased by more than 2,5 times – from 680 billion tenge to 1,8 trillion tenge.

Concerning the oil and gas filed, in order to achieve the sustainable development, Kazakhstani enterprises should modernize and increase the efficiency of the existing production, transfer technologies, form the competent staff potential.

Thus, the purpose of the expert workshop is to analyze the main barriers and to work out joint recommendations to improve public policy in the field of the local content development.

In this connection, study of the advanced foreign experience and development of the international cooperation in this field with the experts of the member countries of the World Petroleum Council are of special interest.                 

KAZENERGY Association investigates the implementation of recommendations made by the international and Kazakhstan experts. The obtained results, conclusions and proposals on the local content improvement under new conditions will be summarized and presented within the special session of the XXII World Petroleum Congress in Istanbul (Turkey) in 2017.

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