Kazakh Officials Urge Citizens To Conserve Gas As Imports Become Necessary

Authored by EurAsiaNet via OilPrice.com,

• Kazakhstan’s state-owned natural gas company, QazaqGaz, has vowed to prevent future gas shortages by refraining from exporting gas and importing gas when necessary.

• Despite sitting atop 3.8 trillion cubic meters of gas, Kazakhstan’s energy officials urge citizens to conserve gas and be more economic in their use of it to avoid peak demands that could cause shortages.

• Plans are being drawn up to build a transnational pipeline from Russia to China to extend gas supplies to the east of Kazakhstan, and a processing plant with the capacity to produce up to 1 billion cubic meters of gas will be built at Kashagan by 2024.

Kazakhstan’s state-owned natural gas company has vowed that there will be no repeat shortages of the fuel next fall and winter like the ones that the country began to experience in late 2022.

But Arman Kasenov, the deputy chairman of QazaqGaz, has said that consumers must in future also do their share in helping avoid crunches at times of peak demand by being more economic in their use of gas. Anybody failing to do so could face stiff bills, he hinted.

In the short-term, Kazakhstan plans to prevent shock deficits by refraining from exporting gas. 

“Taking the growth in gas consumption within Kazakhstan into account, QazaqGaz cannot count on exports in the next fall-winter period,” Kasenov said on February 24.

Indeed, far from thinking about exports – and China is the only game in town in this area – Kazakhstan is now resorting to buying imported gas. 

Earlier this week, Energy Minister Bolat Akchulakov said at a government meeting that plans are being drawn up to import gas from Russia to provide for areas in the east of Kazakhstan. Akchulakov said no prices have yet been discussed.

The infrastructure for those specific imports does not yet exist, however. Extending gas supplies to those regions of Kazakhstan will be contingent on completion of a transnational pipeline running from Russia to China. 

“We have earlier proposed to Gazprom the idea of a transit route through the territory of the East Kazakhstan Region,” Kasenov said at a meeting held under the auspices of the Samruk-Kazyna state holding company.

“It is under development. We have already carried out technical and economic feasibility studies.”

In October, Kazakh President Kassym-Jomart Tokayev said QazaqGaz had reached a sales agreement with Turkmenistan’s Turkmengaz and that he hoped up to 1.5 billion cubic meters of gas could be imported annually under a long-term deal.

According to QazaqGaz data, gas consumption in Kazakhstan in 2022 reached 21 billion cubic meters, while 5 billion cubic meters were earmarked for export. The expectation is that consumption will soar to 40 billion cubic meters by 2030.

The irony of Kazakhstan’s reliance on imports is that it has more than enough gas of its own.

As the country’s energy officials enjoy boasting, Kazakhstan sits atop 3.8 trillion cubic meters of gas, enough to last them 100 years. A good 70 percent of that total is concentrated in four huge fields: Karachaganak, Tengiz, Kashagan and Zhanazhol.

What remains, however, is to get that gas out of the ground. 

On that point, the Energy Ministry has said that a processing plant with the capacity to produce up to 1 billion cubic meters of gas will be built at Kashagan by 2024. 

In spite of all this potential, officials are nevertheless insistent that consumers need to be trained into more parsimonious usage.

“In northern regions, where the fall-winter period lasts almost nine months, households consume about 500-1,000 cubic meters. But in southern and western regions, consumption is three times higher. This suggests that there is some kind of business being run out of the household: a hotel or a store,” Kasenov said.

“We want to introduce a social minimum threshold. If it is a household, or if it is an individual housing unit, if the baseline bits of equipment are a cooker, a gas stove and a boiler, we can calculate the standard consumption. Everything above that is excess consumption.”