Kazakhstani oil refining reports twofold decline in output

The amount of oil production and oil refining has declined for the second day in a row in Kazakhstan. Both industries have suffered a sharp decline in output by 20.8% and 45.8% respectively, according to the Information and Analytical Center for Oil and Gas (IACOG) under the Ministry of Energy.

On July 4, Kazakhstan produced 200,100 tons of oil and 142 million cubic meters of gas, while oil refineries processed 20,200 tons of oil. The price of Brent crude oil that day was $76.11 per barrel, the IACOG reported.

On July 3, oil and gas condensate production amounted to 218,900 tons, gas production to 154.2 million cubic meters, and oil refineries processed 28,900 tons of oil. A barrel of Brent crude oil cost $74.94 that day.

On July 2, oil and gas condensate production was 252,600 tons, gas production reached 169.6 million cubic meters, while oil refineries processed 37,300 tons of oil. A barrel of Brent crude oil cost $74.90 that day.

In this regard, it’s safe to say that the production of oil in Kazakhstan has decreased by 20.8%, natural gas by 16.3% and oil refining dropped by 45.8% since July 2.

On July 4, Prime Minister Alikhan Smailov vowed to prevent a shortage of gasoline that was expected to happen after a blackout in the western part of the country forced the Atyrau oil refinery to suspend its operation. According to the prime minister, there is plenty of fuel in the country’s reserves to offset the damage the blackout caused to the refinery. He also said that all the speculations about oil refineries not working in the country are unfounded.

Smailov ordered the Ministry of Energy, the Ministry of Internal Affairs and the Antimonopoly Agency to take necessary measures to cut short illicit trading with fuels and lubricants amid artificial deficits of oil products.

In turn, Dauletzhan Khasanov, deputy head of KazMunayGas, which owns all three large oil refineries in the country, said that the Atyrau refinery is gradually restoring its usual work as the energy supply in the region stabilizes. It is expected that the refinery will restore 100% of its operations by the end of the current week.

According to Energy Minister Almasadam Satkaliyev, given the acute shortage of gasoline AI-95 in Kazakhstan, the Russian company Gazpromneft organized its supply to the country. Kazakhstan needs at least 40,000 tons of additional gasoline. As the minister noted, the only way to get rid of the deficit in AI-95 is to import fuel from Russia. As of today, the country has 351,000 tons of AI-92 in its reserves (enough for 23 days), 46,000 tons of AI-95 (15 days) and 520,000 tons of diesel fuel (29 days).

Kanysh Moldabayev, CEO of KEGOC, a grid company in Kazakhstan, said that the energy supply for consumers of the Atyrau load center is no longer limited. On the other hand, the Mangustau load center is still supplying commercial enterprises with no more than 65 megawatts. The limit is due to the 140-megawatt power unit No.1 of the Mangistau Nuclear Power Plant (MAEC) remaining switched off until July 7. Moreover, the 200-megawatt gas turbine power plant by Karaban Utility Solutions in Atyrau is also going to stay switched off for a while.

There are three large refineries in Kazakhstan: the Atyrau refinery (ANPZ), Pavlodar Oil and Chemistry Refinery (POCR) and the Shymkent refinery (PetroKazakhstan Oil Products LLP). ANPZ is on a scheduled overhaul until July 19. The Shymkent refinery has suspended its production of AI-95 gasoline from July 3 to July 14 due to the regeneration of a reforming catalyst used to increase the octane number in gasoline. The Atyrau refinery was supposed to offset the shortage of AI-95 gasoline after the Shymkent refinery announced the overhaul.

However, on July 3, the Atyrau refinery stopped its production due to a blackout. The disruption of the power supply was caused by a sharp increase in coolant pressure in a boiler at MAEK.

MAEK runs two thermal power plants and one steam power plant. The nuclear reactor plant BN-350, which used to provide electricity and fresh water to the city of Aktau, has been in the decommissioning process since 1999.