Implementation of state exploration program: Up to 6 trillion tenge of investments to be attracted in Kazakhstan and over 20 thousand jobs to be created

Tuesday, 18 February 2020, 11:28:59

At the regular government session chaired by the Prime Minister Askar Mamin, the draft Concept of the State Geological Exploration Program for 2021-2025 was considered.

According to the Minister of Ecology, Geology and Natural Resources Magzum Mirzagaliyev, more than 8 thousand deposits are listed on the state balance of the country, of which 317 are hydrocarbons (oil, gas, condensate), 910 are solid minerals, and more than 3 thousand are common minerals, and about 4 thousand is groundwater.

“Over the past decades, large lead-zinc deposits have been worked out in East Kazakhstan: Shemonaikhinskoye, Yubileyno-Snegirikhinskoye, Zyryanovskoye, located near single-industry towns. By 2025–2040, the depletion of reserves of several large deposits is expected: Orlovskoye, Maleevskoye, Tishinskoye, Ridder-Sokolnoye. To date, the replenishment coefficient for solid minerals is 0.13, and for hydrocarbons — 0.9 (excluding the Kashagan field). In this regard, it is necessary now to intensify exploration, since at least 10-15 years elapse between the discovery and launch of a new field,” Mirzagaliyev said.

Significant prospects for gold deposits are located in the Kostanay region, the territory between Central and Eastern Kazakhstan, the southern part of the country adjacent to Kyrgyzstan. New lead-zinc deposits can be discovered in the center and in the south of Kazakhstan, and in the Ore Altai.

There are prospects for discovering new deposits in other ore minerals — tungsten, molybdenum, aluminum, tin, as well as rare earth elements.

According to the minister, there is positive experience in attracting investors for geological exploration.

So, over the past 3 years, a study was conducted on the territory of 75 thousand square meters. km Together with Kazakhmys, a large lead-zinc deposit Dusembay was discovered (reserves of 2.8 million tons), with the Ulmus Fund, the Besshoky copper deposit was discovered (reserves of 1 million tons), and with Rio Tinto, the Pribrezhnoye deposit was discovered in the Balkhash area. As a result of cooperation, about 17 billion tenge was attracted.

In terms of hydrocarbons, geologists have identified 15 sedimentary basins with estimated equivalent fuel resources of about 76 billion tons.

“The discovery of the fields Kashagan, Kalamkas-Sea, North Truva and others is the result of modern seismic surveys in the 90s. Today, there are a number of old seismic data, but their quality and detail do not meet modern requirements. Because of this, the potential of the deep horizons of the Caspian has not been fully assessed. The Caspian basin has been and remains attractive to investors. Currently, many domestic and foreign companies are interested in the geological study of this basin. In this regard, modern seismic exploration is required, which will provide updated geological information. We have begun work to intensify exploration,” said the minister.

About 4,000 groundwater deposits with approved reserves of 43 million m3 / day are accounted for in the republic. According to hydrogeological characteristics, groundwater resources are unevenly distributed — about 50% of the resources are concentrated in the south of the country, 30% in the central, northern and eastern regions, and less than 20% in the west.

According to Mirzagaliyev, in order to provide the population with high-quality drinking water, agriculture and industries, groundwater reserves need to increase the number of hydrogeological studies in poorly provided regions.

In this regard, the Concept of the State Program of Geological Exploration for 2021-2025 was developed, the purpose of which is to create conditions for sustainable replenishment, development and support of the competitiveness of the mineral resource base.

The program defines 7 main tasks:

  • Improving the geological exploration of the territory of Kazakhstan.
  • Replenishment of the mineral resource base (that is, an increase in mineral reserves)
  • Research support
  • Informatization and digitalization of the industry
  • Development of the infrastructure of the geological industry
  • Staffing
  • Ensuring the socio-economic well-being of the country.

In addition, within the framework of the State Program, measures are planned to assess the oil and gas potential of poorly studied sedimentary basins and to increase the depth of research within the mining areas, primarily in the area of ​​single-industry towns.

The state program will be implemented through the state budget and private investment.

“During the implementation of the state program, about 680 billion tenge of hydrocarbon investments is forecasted. About 100 billion tenge of investments are planned to be attracted to the exploration of solid minerals,” the minister emphasized.

Thus, the implementation of the State Program by the end of 2025 will achieve a number of results that have a multiplier effect in several sectors of the economy at once.

  • To increase the study of the territory from 25.8% to 37% of the territory available for study.
  • Assess the estimated mineral resources and identify about 50 potentially promising mineral objects.
  • To increase the degree of knowledge of sedimentary basins: developed basins — up to 60%; poorly studied — up to 10%;
  • To provide an increase in forecast resources for minerals.
  • The expected return on investment of 200 billion tenge for exploration of funds for this state program is estimated at 800 billion tenge, that is, invested 1 tenge brings 4.
  • During the implementation of the state program, employment during exploration will increase to 60 thousand people. In the case of the discovery of about 10 fields, an even greater effect is predicted in the subsequent stages of work: investment in the amount of 6.3 trillion tenge and the creation of up to 20 thousand new jobs.

The President of the Kazakhstan Society of Petroleum Geologists Baltabek Kuandykov made a report on the relevance of the issue and approaches to the development of exploration in the Republic of Kazakhstan. According to him, the Concept takes into account that the oil and gas and metallurgical industries, the basis of which is the mineral base, are basic for the republic.

“The threat of curtailing the oil and gas industry in some regions of the country may arise in the next 10-15 years. The prosperity of the oil and gas industry is created thanks to the three giants Tengiz, Karachaganak and Kashagan. However, their potential also has a limit. In 20-30 years, this can lead to a natural decline in oil production, so it is important now to purposefully increase exploration work, to develop deep horizons,” Kuandykov said.

In turn, Commercial General Manager of Shell Kazakhstan Aidan Murphy said that Shell supports the basic principles of the Concept, aimed at increasing both the efficiency and the rate of exploration of hydrocarbons in Kazakhstan. In this regard, Shell fully supports the task set by the Republic to create conditions for sustainable replenishment and development of mineral and oil and gas resources.

“We believe that this can be realized only through close cooperation between the Government, the population and investors. It is very important for us that the Concept reflects the Government’s task of improving the regulatory framework of subsoil use in terms of guaranteeing the observance of investors ’rights, protecting their capital investments, as well as simplifying administrative procedures, for example, in terms of introducing the ‘one-stop shop’ principle for investors,” said Murphy.

According to him, Kazakhstan has the potential to improve its position among the largest oil and gas producing countries, which, in turn, will require attracting significant investments in active exploration work with the introduction of the best advanced technologies.

General Director of Kazakhmys Barlau Galym Nurzhanov informed that the purpose of the exploration unit is to replenish and expand the mineral resources base of Kazakhmys.

The main industrial facilities of Kazakhmys are located in the areas of the single-industry towns Zhezkazgan, Satpayev and Balkhash, the vital activity and development of which directly depends on the success of exploration activities and the investments made in it.

So, since 2015, Kazakhmys has invested about 11 billion tenge in exploration.

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