Minister of Energy Yerlan Akkenzhenov reported that the volume of goods, works, and services procured by subsoil users in the energy sector totaled 1.1 trillion tenge in the first quarter of 2025, with in-country value reaching 680 billion tenge, accounting for 60.2% of the total.

He also noted that for 2024, the same indicator reached 6.1 trillion tenge, of which 3.8 trillion tenge or 61.9% constituted in-country value. According to the minister, a positive trend in the share of in-country value in procurement continued throughout 2024.

The minister clarified that the majority of procurement is concentrated among TCO, KPO, and NCOC (62%), while Samruk-Kazyna accounts for 23%, and the remaining 15% is made by other subsoil users.

Ongoing efforts are being carried out jointly with operators of major oil and gas projects—NCOC, KPO, and TCO—to increase Kazakhstani participation in procurement.

In 2024, operators signed 58 contracts with domestic manufacturers and service providers totaling approximately 423 billion tenge. Since the beginning of 2025, 8 contracts worth around 12.5 billion tenge have already been signed.

Following the July 2024 open house days held by TCO, KPO, and NCOC, 55 memorandums of cooperation with domestic producers were signed. As a result, NCOC signed 7 contracts for goods supply worth 16.3 billion tenge, KPO signed 2 contracts worth 2.1 billion tenge, and TCO signed 5 contracts for goods and services worth 2 billion tenge. The process of transforming the signed memorandums into actual contracts is ongoing.

The minister also announced amendments to the tender procedures for the North Caspian and Tengiz projects. These changes include the possibility of direct procurement from a single local producer, tenders exclusively among Kazakhstani suppliers, an increased preferential margin for local companies, and provisions for investment-based contracts and long-term agreements. Similar procedures for the Karachaganak project are expected to be approved soon.

Akkenshenov further reported on the revised in-country value development programs for goods, works, and services for NCOC and KPO. The updated programs set annual targets for increasing the in-country value share and include procurement mechanisms to support Kazakhstani suppliers.

For KPO, the target is to increase in-country value for goods from 18% in 2025 to 30% in 2029, and for NCOC from 17% to 28% over the same period. The programs also outline step-by-step growth in the share of works and services. TCO’s in-country value development program is currently under approval.

Work has also been done to launch electronic procurement systems (E-procurement) by the operators, covering the full tender cycle—from supplier application to contract signing. Full implementation of the e-systems by KPO and NCOC is scheduled for the second half of 2025.

Importantly, efforts to secure long-term production orders for domestic manufacturers are under constant monitoring. In 2024, KPO signed 4 long-term goods contracts worth approximately 6 billion tenge, and NCOC signed 4 contracts worth 7.7 billion tenge.

Subsidiaries of NC KazMunayGas signed 22 long-term contracts worth 15.9 billion tenge, 46 off-take contracts worth 3 billion tenge in 2024, and from the beginning of 2025, 16 long-term contracts worth 3.9 billion tenge and 18 off-take contracts worth 202.5 million tenge were concluded. The procurement rules of the Samruk-Kazyna Fund allow prioritized procurement from domestic manufacturers.

The Fund’s procurement procedure was verified in 2024 by the European Bank for Reconstruction and Development and the Asian Development Bank for compliance with international standards, enabling major infrastructure projects in the energy sector to be implemented with support from international financial institutions and local producers.

Other subsoil users signed 10 long-term contracts worth 12 billion tenge in 2024. An analysis of their procurement revealed 118 product categories with total procurement exceeding 1.5 billion tenge per company. So far in 2025, 53 long-term contracts worth 17.5 billion tenge have been signed.

The Ministry is also working on localizing production within Kazakhstan. Between 2022 and 2025, 8 production facilities were localized, including:
Wika (Germany), Honeywell (USA), PetrolValves (Italy), Sigma Solutions (Kazakhstan) in partnership with N.Vent (USA), Schlumberger (USA), Yeskertkish Kyzmet Kazakhstan (Kazakhstan), Euro Circuit Technology (Malaysia), and Beruseal (South Africa).

These projects enabled Kazakhstan to develop capabilities for producing high value-added goods domestically.

“Work is underway to localize 7 new productions in cooperation with global manufacturers of original goods in high demand in the oil and gas sector, including Leser (Germany), John Crane (USA), Hi Air Korea (South Korea), Baker Hughes (USA), Breda Energia (Italy), Flowserve (USA), and Swagelok (USA),” the minister stated.

Among the key priorities for this year highlighted by the Minister of Energy are:

• Introducing amendments to the procurement rules for subsoil users and their contractors to support domestic producers;

• Concluding long-term contracts and off-take agreements;

• Organizing B2B meetings between operators (TCO, KPO, NCOC) and Kazakhstani producers to convert memorandums into actual procurement contracts;

• Localizing production and technologies for import substitution

#Energy #Government session #Manufacturing industry

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