Kazakhstan

EITI Status Meaningful progress
Joined EITI in 2007
Latest Data From 2016
Latest Validation 2018
Website EITI Kazakhstan
Last updated 19 July 2019

Overview

Kazakhstan’s extractive sector plays an important role in the country’s development, with revenues constituting more than half of the state budget. It has the largest recoverable crude oil reserves in Central Asia and its current oil production is approximately 1.73 million barrels a day. With much of the government revenue coming from the extractive sector, Kazakhstan was among the first Central Asian countries to announce its commitment to the EITI in 2005. 

Kazakhstan has been lead in timely EITI reporting among Central Asian countries, having produced reports well ahead their deadlines. See the news items for publicaiton of the 2015 and 2014 EITI reports.

Kazakhstan’s extractive sector plays an important role in the country’s development, with revenues constituting more than one third of the state budget and more than half of the total exports in 2016. It has the largest recoverable crude oil reserves in Central Asia and its current oil production is approximately 1.8 million barrels a day. Atyrau, Mangistau and Western Kazakhstan continue to lead in oil and gas extraction. One of the biggest oil fields – Kashagan – started its oil production in October 2016. After eight years of delay, sixteen years of development and more than USD 50 billion of investment from NCSPSA (the North Caspian Sea Production Sharing Agreement) Consortium, operated by NCOC, the Kashagan oil field production, together with Tengiz and Karachaganak, is expected to be one of the main contributors to economic growth in Kazakhstan in the upcoming years. According to the latest data, in 2017, Kazakhstan produced a record volume – 86,2 million tonnes – of oil since gaining independence.

With much of the government revenue coming from the extractive sector, Kazakhstan was among the first Central Asian countries to announce its commitment to the EITI in 2005. Kazakhstan has been lead in timely EITI reporting among Central Asian countries, having produced reports well ahead their deadlines. See the news items for publication of the 2015 and 2016 EITI Reports.

Extractive industries contribution

  • 50 %
    to GDP
  • 277600
    jobs
  • 22.8 bn
    in USD to export

News, blogs and more

Tax and legal framework

In December 2017, a new Code on Subsoil and Subsoil Use was approved.  The Code introduces a simplified process for allocation of licenses by providing the extractive companies with fairer bidding opportunities, including through online services; and more liberal technical and financial criteria. Additionally, the Code addresses the issue of hidden ownership by introducing a concept of control over a company, allowing the government and business partners to see who they work with.

According to the 2016 EITI Report, more than 90% of the explored natural resources in Kazakhstan have already been developed. Only 2.5% of the companies chose to invest into the geological exploration. Updating the geological database according to internal standards and attracting investment are therefore among other government priorities addressed through the new Code on Subsoil and Subsoil Use.  

The main agency responsible for collecting and managing the taxes is the State Revenue Committee under the Ministry of Finance of the Republic of Kazakhstan.

Licenses 

Licenses are granted through an Electronic Licensing of the Republic of Kazakhstan, following their registration on the website www.elicense.kz. Applicants can obtain or change details of licenses through the e-licensing web portal for the activities under “Subsoil Use” section. Rights to exploitation and production of hydrocarbons, coal, and uranium are awarded by the Ministry of Economy, whereas rights to exploitation and production of other minerals are awarded by the Ministry of Investments and Development.

Since November 2015, a pilot mode of granting the right to exploration in simplified order according to the principle “first came - first received” (Australian method) took place in Stepnogorsk. This work will be carried out on a permanent basis with a phased coverage of the entire territory of the country.

An interactive license cadastre map hosted by the Committee of Geology and Subsoil use was launched in 2015 and includes information on the name of the license holders, the coordinates of the license area, the type of a license, and the commodity being produced for the licenses that have been added to the cadastre so far. For some licenses, the cadastre includes the date of award, for others the expiry date and for some the duration (number of years that the license is valid for).

Beneficial ownership disclosure

Kazakhstan has initiated discussions around beneficial ownership disclosures in the country following the amendments to the EITI Standard in February 2016. According to the Requirement 2.5.b.ii. "it is required that by 1 January 2017, the MSG publishes a roadmap for disclosing beneficial ownership information in accordance with 2.5.c. and 2.5.f." In accordance with this requirement, Kazakhstan's beneficial ownership roadmap was published in December 2016 (see the document below).

Although new to the discussion of the beneficial ownership disclosures, Kazakhstan has already taken steps in bringing about changes in the country's legislature through launching discussions around amending the Subsoil and Subsoil Use Code. Following the establishment of the Interministerial Working Group on beneficial ownership disclosures in 2017,  members of the EITI National Stakeholders Council agreed to pilot BO disclosures in their next EITI Report. 

 

Beneficial Ownership Roadmap - Kazakhstan
It is fascinating to see how the EITI reporting affected change in bringing more responsible management of the extractive sector in Kazakhstan beyond mere compliance to the requirements of the Standard.
Ruslan Baimishev, National Coordinator

Production

Kazakhstan is a leading producer of oil in Central Asia. It is also a major producer of gas, gold, coal, iron, uranium, manganese, bauxite and chromite. Ongoing production is concentrated in 15 regions: Tengiz, Kashagan, Karachaganak, Uzen, Zhetybai, Zhanazhol, Kalamkas, Kenkiyak, Karazhanbas, Kumkol, North Buzachi, Alibekmola, Central and Eastern Prorva, Kenbai, Korolevskoye.

Natural resources

CommodityReservesUnitSignificance
Oil3,9billion tonsKazakhstan has 1.8% of the world’s oil reserves.
Gas1,5trillion Sm3Kazakhstan has 0.8% of the world’s gas reserves.
Coal33,6billion tonsKazakhstan has 3.8% of the world’s coal reserves
Gold213,50tons
Uranium1,7million tonsKazakhstan is second in the world in terms of volumes of prospective reserves.
Iron19thousand metric tons
Manganese700thousand
Bauxite345thousand metric tons
Chromite366thousand metric tons
Mining: reserves, production and export” in 2014 EITI Report

Initializing chart.

Initializing chart.

Revenue collection

The 2015 EITI disclosures showed that Kazakhstan received a revenue of USD 12 billion from the extractive industry. Slightly more than half of these revenues came from hydrocarbons, mainly oil and gas, with the rest from mining, with iron, copper and gold as the major commodities. Revenues were mainly collected through taxes and royalties.

Initializing chart.

Reconciled revenues by company (top 5)

Revenue allocation

Revenue from the oil and gas sector is managed by the National Fund of Kazakhstan while revenue originating from the mining industry is managed by national and municipal governments, depending on the types of payment or tax (details are disclosed in Table 1 of the 2014 EITI Report). Revenue and expenditure reports are regularly published by the Ministry of Finance in the Statistical Bulletin.

Ministry of Finance of the Republic of Kazakhstan

Innovations

​The EITI encourages multi-stakeholder groups to explore innovative approaches to make the EITI more relevant and useful.

  • The National Stakeholders Council has expressed interest in taking part in the EITI mainstreaming pilot.
  • Online reporting through EGSU.
  • Reports include disclosure of social expenditures.
  • EITI Reports led to change of classification codes to ensure that companies transfer social payments to the budget. Both local and central governments can now easily track the payments.

Implementation

EITI implementation in Kazakhstan is led by the National Stakeholders Council (NSC). The NSC is chaired by Zhenis Mahmudovich Kassymbek, Minister Investments and Development of the Republic of Kazakhstan. 

The NSC, together with the Ministry of Energy has taken the lead in mainstreaming EITI reporting by requesting that companies file their EITI reports as part of other mandatory reporting for subsoil license holders, using an existing online platform - EGSU. The system proved to be successful during the data collection processes in the past though Kazakh EITI team constantly works with the Ministry of Energy that hosts the data portal on its improvements. 

As part of their effort to bring transparency to the extractive industry the NSC has agreed to take part in EITI mainstreaming pilot.

Timeline

Validation

Kazakhstan’s Validation against the 2016 Standard commenced on 1 July 2017. On 13 February 2018, the EITI Board decided that Kazakhstan has made meaningful progress in implementing the EITI.

See the scorecard with descriptions of each requirement below.

Kazakhstan's progress by requirement

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Scorecards show the outcomes of Validation. Arrows of progress indicate where the International Secretariat has re-assessed a requirement following a corrective action in a second or third Validation. 

The reports demonstrate the extent to which our country’s budget is dependent on the extractives sector. The prudent use of these revenues, particularly with the most recent substantial decline in oil prices globally, is crucial for Kazakhstan’s development.
Maria Lobacheva from Almaty-based civil society organisation Echo.

EITI Reports and other key documents

Kazakhstan 2018 Annual Progress Report

Published Date: 
May, 2019
Publisher: 
EITI Kazakhstan

The Annual Progress Report provides an overview of all EITI Kazakhstan's activities in 2018. The report is available in English, Kazakh and Russian.

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2017 Kazakhstan EITI Report

Published Date: 
October, 2018
Publisher: 
EITI Kazakhstan

This EITI Report covers Kazakhstan's extractive sector in 2017. It was published in November 2018. 

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Kazakhstan 2017 Annual Progress Report

Published Date: 
May, 2018
Publisher: 
Kazakhstan EITI

The Annual Progress Report provides an overview of all EITI Kazakhstan's activities during 2017. The report is available in English and Russian.

Read more

Kazakhstan Validation 2017

Published Date: 
November, 2017
Publisher: 
EITI International Secretariat

On 13 February 2018, Kazakhstan was found to have made meaningful progress in implementing the 2016 EITI Standard. See Board decision 2018-13/BM-39

Timeline of Validation and related materials

Initial data collection and stakeholder consultations

02.10.17 - Report on Initial data collection and stakeholder consultation [English Russian

Read more

Feasibility study: Systematic disclosures of EITI data in Kazakhstan

Published Date: 
October, 2017
Publisher: 
Ernst & Young

Mainstreaming EITI: Pilot Study in Kazakhstan

This report has been compiled by EY company which was selected to act as the consultant with regards to the pilot study (feasibility study) on mainstreaming EITI in Kazakhstan. The study comprised the following objectives:

consideration of the current situation regarding disclosure of data by extractive industries as required by the EITI Standard (see Section 5), identification of data from extractive industries that was made publicly available through information systems, government registries and cadasters,

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2016 Kazakhstan EITI Report

Published Date: 
September, 2017
Publisher: 
Kazakhstan EITI

This EITI Report covers Kazakhstan's extractive sector in 2016. It was published in October 2017. 

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2015 Kazakhstan EITI Report

Published Date: 
November, 2016
Publisher: 
Kazakhstan EITI

This EITI Report covers Kazakhstan's extractive sector in 2015. It was published in November 2016. 

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2014 Kazakhstan EITI Report

Published Date: 
September, 2015
Publisher: 
Kazakhstan EITI

This EITI Report covers Kazakhstan's extractive sector in 2014. It was published in September 2015. 

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2013 Kazakhstan EITI Report

Published Date: 
December, 2014
Publisher: 
Kazakhstan EITI

This EITI Report covers Kazakhstan's extractive sector in 2013. It was published in December 2014. 

Read more
View all documents related to Kazakhstan in our publications library

Contacts

National Coordinator

Head of the national secretariat

Elvira Jantureeva

Head of the national secretariat
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International Secretariat

Oliana Valigura

Oliana Valigura

olianavaligura
Regional Director
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Olesia Tolochko

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Country Officer
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