South Oil by Serikzhan Seitzhanov wants to produce oil at Akshabulak Field

South Oil, a company controlled by Kazakhstani mogul Serikzhan Seitzhanov, is planning to launch oil production at the Western Akshabulak oil field in the Kyzylorda region with an output of 100,300 tons starting in 2027.

As the company reported, it is considering three different scenarios for oil field exploration. The most preferable is the second one, which involves drilling 17 new wells and bringing eight old wells back into operation. As a result, these 25 wells are expected to secure an output of 100,300 tons of oil at its peak in 2028. The accumulated oil output is expected as 1.23 million tons. The company also said that it will start oil production in 2027 and will continue until 2046, although the project is scheduled up to 2055.

The second scenario was chosen likely due to the high oil output compared to 725,300 tons with eight new and eight old wells (the first scenario) and 1.1 million tons with 21 new and eight old wells (the third scenario).

Given there is no oil treatment facility on the Western Akshabulak oil field, South Oil is planning to transport the oil by trucks to the Kenlyk oil field to treat the oil there. The company is expected to use water from the well on the Western Akshabulak oil field.

The oilfield is located in the Terenozek district of the Kyzylorda region in a remote area. The nearest big settlements with railway transportation are Kyzylorda (150 km southwest), Jezkazgan (260 km northward), the Terenozek settlement and the Josaly railway station (160 km westward) and the Kumkol oil field (40 km northwest). The Karakoin-Kumkol pipeline is located 40 kilometers northward from Akshabulak, although there is the Akshabulak-Kumkol-Karsakpay- Jezkazgan power line.

FTIC Ontustik LLP controls 57.16% of South Oil. In turn, FTIC Ontustik LLP is controlled by the Seitzhanov family (Serikzhan Seitzhanov – 50%, Nurzhan Seitzhanov – 10%, Zhanna Seitzhanova – 10%, Kanshaim Seitzhanova – 10%, Baurzhan Seitzhanov – 10% and Bakhytzhan Seitzhanov – 10%).

South Oil exports its crude oil via the Caspian Pipeline Consortium and pipelines run by KazTransOil, a subsidiary of KazMunayGas. In addition, South Oil ships crude oil to the Shymkent refinery through a group of oil traders. These crude oil supplies are conducted under the arrangement with the Ministry of Energy to ensure local refineries have enough raw materials to deliver oil and oil products supply to the domestic market.

South Oil possesses licenses for oil production at Kenlyk (until 2033), Karabulak (until 2035), Aktau (until 2042), Eszhan (until 2042), as well as Northern Akshabulak and Western Akshabulak (until 2026). Moreover, the company also had a contract for exploration at the Kalzhan oil field.

In May 2023, Seitzhanov and Power Corporation of China (POWERCHINA) signed a contract in Xian for the construction of a 72-megawatt hydro-electric station on the Ugam River and clustered water supply in the Turkestan region.

After signing the contract at an official ceremony, Seitzhanov said that the power station would be built within two to 2.5 years. Potentially, the capacity of the $328.5 million project might be increased to 165 megawatts. Under the project, investors are going to build a 12-kilometer tunnel, a 40-kilometer water supply, a reservoir and a water purification facility in the village of Zhanabazar. As a result, the facility will be able to produce 110 million cubic meters of water and 72 megawatts of electricity and provide water to more than one million people in five districts of the region.

With a fortune of $360 million, the Seitzhanov family is ranked 23rd among the richest Kazakhstanis, according to Forbes. The family also owns the five-star hotel Rixos Khadisha Shymkent, the Satti Zhol gas station chain and a cement plant, among other assets.