“Karachaganak Petroleum Operating B.V.” (KPO) and “Aksai Industrial Park LLP” (AIP) have announced signing a Memorandum of Understanding (MoU) and associated Road Map. The documents signed under the initiative proposed by the Ministry of Oil and Gas of Kazakhstan will serve long-term economic development, since they are aimed to promote local capacity development, technology transfer and industrial sector growth due to localization of high-tech production in the West Kazakhstan oblast.

As the Minister of Oil and Gas, Uzakbai KARABALIN, noted: “In accordance with the request of the Head of the Government of the Republic of Kazakhstan concerning the formation and development of high-tech services sector in oil and gas industry, the Ministry of Oil and Gas has initiated the development of the Roadmap of Aksai Industrial Park in order to localize a number of products and services which are currently supplied from abroad”.

“During my visit to Aksai, in February this year, we concluded the discussion of issues and defined nine projects, which implementation would facilitate import substitution, production of high-tech products and services for Karachaganak project, and creation of new jobs in the region” - said Uzakbai KARABALIN.

KPO General Director, Damiano Ratti, noted: “Signing of the MoU with AIP is a new stage for KPO on the way of maximizing the involvement of Kazakhstani companies in the Karachaganak project implementation. KPO fully supports the initiatives of the RoK government on local content development and works in close cooperation with the RoK authorities to achieve this goal”.

“Local capacity improvement through sustainable development and transfer of best practices is the key focus area of our activities. We hope that as a result of our cooperation, AIP will be able to provide competitive technological services and products required by KPO in its production activities”, - added Damiano Ratti.

“Successful implementation of this initiative will create conditions for manufacturing of more complex high-tech products capable to meet the needs of Kazakhstan oil and gas industry” - said Damiano Ratti.

The Road Map associated with MoU defines a number of key joint initiatives aimed at increasing the local content in the Karachaganak project by means of technology transfer and creation of new jobs for local residents. Primary focus is on those services and products, which are currently supplied by foreign companies.

The list of AIP key initiatives include the establishment of a new laboratory for equipment testing, valves and instrumentation repair workshop, as well as introduction of pipeline pigging technology.

KPO and AIP have agreed to develop a joint activity plan to define types of goods and services, which will be in demand in future in the framework of the Karachaganak project, and linking those with the capabilities of Aksai Industrial Park.

The parties have also agreed to monitor and regularly report on the progress of joint initiatives implementation.

KPO is one of the first companies in the Republic of Kazakhstan, where the local content development program has been successfully implemented. It made it possible to involve more than three thousand Kazakhstani enterprises into the development of Karachaganak.  In general, these companies have received orders from KPO for above $4 billion.  Last year, the local content share in KPO contracts for supply of goods, works and services reached 50.15%, which amounted to $461.1 million in monetary terms.