1. National Company “KazMunayGas”:
Role of Foreign Investment in
Development of Oil & Gas Projects
New York, 7 December 2011

2. Foreign Investment in Republic of Kazakhstan
(from 1993 through 2nd half of 2011)
Investment Inflow Dynamics Largest Investing Countries
mn USD
25000
Netherlands 31,361.80
19,760 USA 21,773.60
20000 19,138
18,453 18,076 Great Britain 10,718.20
France 8,291.40
15000
Virgin Islands (British) 7,119.20
10,624
9,997 Italy 5,519.00
10000 8,317
Russia 5,093.80
6,619
4,5574,1064,624 China 5,031.10
5000
2,781 Canada 4,745.20
1,271 1,6742,1071,2331,852
660 984
Switzerland 4,272.10 mn USD
0
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
IIQ 0 10000 20000 30000
Political stability and favorable investment Western countries account for the bulk of direct
climate have been promoting a considerable investment: the Netherlands rank first - over 31 bn
inflow of foreign direct investment in Kazakhstan. USD, followed by the U.S. - 21.7 bn USD.
From 1993 through 2nd half of 2011, 136 bn The main direction of investment is connected
USD of investment were attracted to the country. with subsoil use, energy and infrastructure
projects.
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3. Development of Kazakhstan's Oil & Gas Industry
Growth in the proven oil and natural gas reserves
 Oil reserves, bn tons: 1991 – 2.8 2010 – 5.5
 Natural gas reserves, tcm: 1991 – 1.8 2010 – более 3.0
Oil production in 2010 in the world and the Republic of Kazakhstan
Mn tons
Mn tons
Oil production in Kazakhstan
600 140
120
500 100
80
400 60
40
20
300
0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2015 2020
200 130 mn tons by 2020
100
0
United Arab…
Norway
Kazakhstan
Ecuador
Venezuela
Argentina
Kuwait
Russia
China
Nigeria
Colombia
Mexico
Brazil
Oman
Iran
Iraq
Qatar
United Kingdom
Indonesia
India
Sudan
Azerbaijan
US
Canada
Angola
Algeria
Saudi Arabia
Malaysia
Libya
Egypt
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4. Major Oil & Gas Projects - Tengiz Project
In April, 1993 the "century's contract" was made - a long-term 40-years agreement with
Chevron on establishing LLP “Tengizchevroil” (TCO) was signed.
TCO partners: KMG (20%), Chevron (50%), ExxonMobil (25%), LUKArco (5%)
In-place reserves: 3.5 bn tons (25 bn bbl) of oil, over 700 bcm of gas
Добыча нефти
Oil Production
млн.tons
mn тонн
In 2007 TCO successfully
30
implemented the "SGP/SGI"
projects, providing for oil
25 production growth from 13 to
25 mn tons
20 Since 1993, TCO's oil uplift
has exceeded 200 mn tons
15
25,9
Currently the alternatives of
10 22,5
the Future Growth Concept
17,8
12,5 13,1 12,8 13,7 13,6 13,3
13,9 aimed for further increase in
5 8,5 9,6 10,5 production are being
7,0
5,0 considered
1,9 2,5
0 1,5
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010 4

5. Major Oil & Gas Projects - Karachaganak Project
The agreement on sharing production at the Karachaganak field was signed in March, 1995.
Final production sharing agreement (FPSA) for a term of 40 years was signed in
November, 1997
Partners: Agip (32.5%), BG (32.5%), Chevron (20%), LUKoil (15%)
In-place reserves: 1.5 bn tons (9 bn bbl) of liquid hydrocarbons, 1,300 bcm of gas
Production of liquid Gas production
млн.tons
mn тонн hydrocarbons млрд. м
bcm 3
16 16
14 14
12 12
10 10
8 8 15,6
15,0 15,0
14,2
6 11,6 11,6 11,9 11,4 6 11,5 11,9
10,3 10,4
8,5 9,1
4 4
5,2 5,9 5,8
4,6 4,7 4,8
2 2,1 3,4 4,0 2 2,3 3,6 3,8
0 0
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
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6. Major Oil & Gas Projects - North-Caspian Project
In November, 1997 the Consortium partners and the
government of Kazakhstan signed a Production Sharing
Agreement (PSA), providing for exploration and production of
hydrocarbons at 11 blocks with a total area of around 5,600
km2.
Such shelf structures as the gigantic Kashagan, Kashagan
South-West, Kalamkas, Kairan and Aktoty were discovered
within the blocks.
Exploration well produced a positive result:
• on Kashagan - on 30 June 2000
• on Kalamkas-more - on 3 September 2002
• on Kashagan South-West - 10 August 2003
• on Aktoty - 2 September 2003
• on Kairan - 10 September 2003
Reserves, mn tons
Deposit in-place recoverable
Kashagan (oil) 4,850 1,475.5
Kalamkas-more (oil) 114.2 31.9
Kashagan South-West (condensate) 20 6
Aktoty (condensate) 156 77
Kairan (oil) 112 36
NCP's total 5,252.2 1,626.4
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7. Offshore Oil Projects - "N" Block
Project participants:
JSC NC “KazMunayGas” – 51%
ConocoPhillips – 24.5%
Mubadala – 24.5%
The Heads of Agreement, under which the parties agreed
on the commercial term sheet for joint implementation of the
"N" project, were signed on 5 December 2008 .
"N" area is located on the Southern part of the Kazakhstan
sector of the Caspian Sea and occupies a total area of 8,184
km2
Water depth is 30-375 m, distance to shore - 15-90 km
In-place reserves - 630 mn tons, recoverable - 270 mn tons
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8. Diversification of Oil Transportation Routes
Over the 20 year of independence of the Republic of Kazakhstan:
 oil exports volumes have increased from 13 to 71 mn tons annually
 about 4,000 km of oil pipelines constructed
 pipeline exports volumes increased from 10 to 58 mn tons annually
"Caspian Pipeline Consortium"
oil pipeline
• Agreement between
Kazakhstan, Russia, Oman, and
Consortium of international oil
companies on construction of the
"CPC" pipeline was signed in
April, 1996.
• Oil pipeline length: 1,510 km
• Commissioned: 2001
• 1 July 2011 - beginning of
construction under the Project for
expansion of CPC up to 67 mn tons
(52.5 mn tons of oil from the
Republic of Kazakhstan)
"Kazakhstan-China" Existing routes
Planned routes
Oil Pipeline
Implementation of the Kazakhstan- Oil transportation, mn tons 2010 "Kazakhstan Caspian Transportation
China oil pipeline expansion (phase  "CPC" oil pipeline 29,9 System" Project
II) will make it possible to increase Need for KCTS's export capacity will arise by
 "Atyrau-Samara" oil pipeline 15,3 the time of implementation of Phase 2 of the
the throughput capacity to 20 mn  "Kazakhstan-China" oil pipeline 10,0 Kashagan field development
tons annually
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9. Diversification of Gas Transportation Routes
"Kazakhstan-China" gas pipeline
In December, 2009 the first line of the first stage of the "Kazakhstan-China" gas pipeline was
commissioned, which is part of the cross-border "Turkmenistan-Uzbekistan-Kazakhstan-China" gas pipeline.
"Beineu-Bozoi-Shymkent" gas pipeline
Development stages: Stage I / Bozoi-Shymkent section - capacity of up to 6 bcm annually
Stage II / Beineu-Bozoi section - capacity of up to 10 bcm annually
Russia
Kazakhstan
Beineu-Bozoi-Shymkent
gas pipeline
Bozoi
Turkmenistan-Uzbekistan-Kazakhstan-China
Beineu Gas Pipeline
Uzbekistan Shymkent
Kyrgyzstan
Turkmenistan China
Tajikistan
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10. Projects for Reconstruction and Modernization of Kazakhstan's Refineries
Implementation of the State Program for Boosted Industrial-and-
Innovation-Based Development and the Program for
Development of the Oil and Gas Industry of the Republic of
Kazakhstan for 2010-2014 will make it possible to :
 increase the average complexity index of Kazakhstan's
refineries to the global indicator of 10.2
 increase the crude processing depth up to 90%
 raise the quality of motor fuels to Euro-4, Euro-5
Investment projects:
 "Construction of the Aromatics Production Complex in the Atyrau Refinery"
 "Construction of the Deeper Oil Conversion Complex in the Atyrau Refinery"
 "Reconstruction and Modernization of the Pavlodar PCP"
 "Reconstruction and Modernization of the PKOP Refinery" (Shymkent Refinery)
 "Road Bitumens Production in the Aktau Plastic Plant"
Anticipated results of reconstructing the refineries:
тыс. тонн
Name Before reconstruction After reconstruction Change (+/-)
Oil refining 13,683 19,000 +5,317
Mogas 2,871 6,722 + 3,851
Jet fuel 484 958 +474
Diesel 4,052 5,919 +1,867
Fuel oil 3,566 1,499 -2,067
Processing depth 66% 90% 24% increase
Oil products quality Euro-2 Euro-4, Euro-5 -
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11. Projects for Reconstruction and Modernization of Kazakhstan's Refineries
Atyrau Refinery Shymkent Refinery Pavlodar PCP
"Construction of the Aromatics Anticipated effect from reconstruction and Anticipated effect from reconstruction and
Production Complex" Project modernization: modernization:
• Recovery of the designed refining • Increase in the refinery's designed
• Increase in the refinery's balanced capacity capacity to 6 mn tons annually capacity up to 7.5 MMtpa.
from 4.3 to 5.0 mn tons annually • Increase in the crude processing depth • Increase in the crude processing depth
• Increase in the volume of production of high- up to 90% up to 90%.
octane gasoline (Euro-3 standard) • Raising the quality of oil products (Euro- • Raising the quality of oil products (Euro-
• Production of petrochemical feedstocks 4, Euro-5 standards) 4, Euro-5 standards)
(benzene, paraxylene). • Reduction in atmospheric emissions of • Reduction in atmospheric emissions of
Project costs: 1.13 bn USD pollutants pollutants
Project implementation period: 2013 Preliminary project costs: 1.45 bn USD Preliminary project costs: 1.7 bn USD
Implementation period: 2015 Implementation period: 2015
"Construction of the Deeper Oil
Conversion Complex" Project
• Increase in the refinery's balanced capacity
up to 5.5 MMtpa
• Increase in the production of high-octane
gasoline, jet fuel and diesel
• Increase in the processing depth up to 87%
First stage of the Atyrau Refinery reconstruction project, completed in 2006, has
• Raising the quality of motor fuels (Euro-
made it possible to replace the obsolete and worn-out equipment, increase the oil
4, Euro-5 standards)
conversion ratio to 61%, improve the quality of gasoline and diesel to the Euro-2
Project costs: 1.7 bn USD environmental standard, increase production of jet fuel and reduce the adverse
Project implementation period: 2015 environmental impact. Total amount of assimilated funds has amounted to 396 mn
USD.
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12. JSC NC “KazMunayGas”
KazMunayGas is the national operator for exploration, production, refining and transportation of
hydrocarbons, representing the state in Kazakhstan's oil-and-gas sector.
The company was incorporated through the merger of National Oil and Gas Company
"Kazakhoil" and National Company "Oil and Gas Transportation", based on the Decree dated 20
February 2002 of the President of the Republic of Kazakhstan.
JSC "National Wealth Fund “Samruk-Kazyna" owns 100% of the company's shares.
Key focus areas
 Processing and marketing of crude and oil
 Oil and gas upstream
products
 Oil transportation
 Support services for the oil & gas industry
 Gas transportation and marketing
 Corporate governance
Key indicators 2010 Share on the RoK's market
 Production of crude oil and gas condensate 21.9 mn tons 28.0 %
 Gas production 4.9 bcm 13.1 %
 Oil refining 15.1 mn tons 83.2 %
 Pipeline oil transportation 65.8 mn tons 76.4 %
 Pipeline natural gas transportation 99.4 bcm 95.7 %
According to the rating assigned by the Energy Intelligence agency, in 2010 KazMunayGas
ranked 36th among the world's top 100 oil & gas companies, climbing 5 positions from the 41st
place in 2009.
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13. JSC NC "KazMunayGas" - Long-term Development Strategy
The goal of JSC NC "KazMunayGas" is to join the world's top 30 oil & gas companies, by pursuing the
strategy of balanced growth in the sectors of oil and gas upstream, gas transportation and marketing, oil
transportation, oil refining and marketing of crude oil and oil products
Key Strategic Indicators for 2011-2020
Oil production, mn tons Oil refining, mn tons
2002 10,6 2,3
2010 22,0 15,1
2015 24,3 19,4
2020 33,7 19,8
Oil transportation, mn tons Gas transportation, bcm
2002 30,3 110,8
2010 65,8 99,4
2015 66,5 127,2
2020 69,5 163,7
Without taking CPC into account
Investment programme
KazMunayGas is planning to implement an extensive investment programme:
• the amount of capital expenditures will amount to about 20 bn USD by 2015
• around 9.5 bn USD will be required for refinancing the existing loans
• the additional debt financing requirement will amount to about 8 bn USD by up to 2016.
The role of KazMunayGas and the scale of its investment create a number of opportunities for mutually beneficial cooperation
with investors and financial institutions.
The basic tools for attracting finance for the company are bank loans and issue of Eurobonds. Currently, the amount of
Eurobonds issue is 7.25 bn USD.
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14. Thank you for attention!
JSC “National Company “KazMunayGas”
19, Kabanbay batyr Ave.,
010000, Astana, Republic of Kazakhstan
tel.: +7 (7172) 97-61-01,
fax: +7 (7172) 97-60-00, 97-60-01
e-mail: Astana@kmg.kz
http://www.kmg.kz
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