Oil tolling contracts not attractive for Kazakhstan any longer – KazMunayGas CEO

March 4, 2014

ASTANA. Interfax-Kazakhstan

Oil tolling contracts are becoming unattractive for Kazakhstan in view of the agreements with Russia on duty-free supplies of light oil products, said Sauat Mynbayev, the head of National Company KazMunayGas.

After Kazakhstan and Russia agreed in late December 2013 to extend the oil, petroleum product supply agreement for another year, the oil tolling contracts do not seem to be expedient any longer, Mynbayev told a Tuesday briefing at the State Office of Press Relations in Astana.

As Russia supplies oil products to Kazakhstan free of duty, the tolling contracts are becoming unprofitable for the customers and the whole Kazakhstan, he said.

In early 2013, when Mynbayev was minister of oil and gas, he said that Kazakhstan’s tolling contracts might total 2 million tons and that tolling contracts apart from China might be concluded with Azerbaijan, Turkmenistan, or Rompetrol.