KPO held a conference on local content

URALSK, West Kazakhstan Oblast, February 27, 2024 — Karachaganak Petroleum Operating B.V. (KPO) held a roundtable conference on «KPO local content development and procurement process» with the support of WKO Akimat.


The conference was attended by representatives of more than 20 companies of West Kazakhstan Oblast, WKO Akimat management, as well as a number of non-governmental organizations.


The conference focused on such key topics as KPO local content development strategy and plans for procurement of goods, works and services (GWS), as well as KPO requirements to GWS suppliers.


In his welcoming speech Mr. Nariman Turegaliev, Akim of West Kazakhstan Oblast, highlighted the great potential of the region in terms of oil and gas equipment production and the availability of production space and opportunities for localizing the production of original manufacturers. Today’s meeting is therefore especially relevant as it is dedicated to local content and procurement process development within KPO, the largest subsoil user, as well as studying problematic issues and identifying ways to solve them.


Mukhtar Mankeev, KPO Vice General Director, in his address to the conference participants, noted that the conference is aimed to discuss the prospects of local content development at the Karachaganak Project in the light of the forthcoming field expansion activities. He also emphasized that the local manufacturers’ production capacity will be supported by placing the orders of the Karachaganak project and this will become a key issue in the near future. For the first time, KPO specialists have analyzed an upcoming procurement and based on that analysis provided the business community with a list of promising goods for localization. According to M. Mankeev, further emphasis will be placed on localization of goods.


In this regard the company is creating a favorable environment to support local suppliers. In particular, KPO is actively developing a 10-year local content development program. These efforts of KPO are aimed at assisting in the implementation of the state program on industrialization and development of machine building in the Republic of Kazakhstan, as well as current government initiatives. These initiatives are aligned with the current strategic state policy priorities.


According to the latest data, local content for 2023 was 63.2% (or US$756.1 million), higher than the 55% planned for last year. During this period, 155 contracts were awarded, of which 142 contracts awarded to local companies worth US$280 million.


Further, in the round table discussions, KPO representatives answered the questions of the forum participants regarding the planned procurement of GWS. The discussions covered such issues as implementation and strategy of local content, KPO Contracts and Procurement department activities, vendor evaluation procedure for registration in the database and KPO tender requirements.


Summarizing the results of the event, Mukhtar Mankeev, KPO Vice General Director, expressed his hope that this event would give local WKO enterprises an additional incentive to meet international quality standards. This would allow increasing the share of local content in all future projects of the consortium.


In turn, the delegates noted the high level of organization of the event and its high efficiency. According to them, a strong expertise of the participants contributed to comprehensive discussion and review of the issues proposed in the agenda.


Notes to Media:


Karachaganak Petroleum Operating B.V. (KPO) is a joint venture between Eni SpA (29.25%), Shell plc, (29.25%), Chevron (18%), Lukoil (13.5%) and KazMunayGas (10%).


KPO oversees the expansion and development of the Karachaganak field — one of the world’s largest gas and condensate fields.


KPO Public and Media Relations Department