KazMunayGas (KMG), Kazakhstan's national vertically integrated oil and gas company, announces its operating results for 2022.

Magzum Mirzagaliyev, Chairman of the Management Board of KMG:
“2022 has become truly full of significant and memorable events for the Company. KMG succeed to achieve positive dynamics of production indicators in all business segments from exploration and production to transportation and refining of hydrocarbons.

The Company made a historic initial public offering of its shares and it is the largest IPO on the Kazakhstani stock exchanges KASE and AIX. On 8 December 2022, secondary trading of KMG shares has been started on the stock exchanges. The listing opens a new era of our corporate development.

An important event was the strategical acquisition of an 8.44% stake in the Kashagan project from Samruk-Kazyna JSC for USD 3.8 billion. The acquisition was one of the most valuable deals for KMG in recent years. As a result of the share increase in the project to 16.88% the Company's consolidated upstream production, EBITDA and net profit indicators will improve.

Another significant event was the launch of a large-scale integrated gas chemical complex of Kazakhstan Petrochemical Industries Inc. LLP, a 49.5% stake in which KMG acquired in the reporting year. This project is designed to produce up to 500 thousand tonnes of polypropylene per year. At the end of 2022, the products of the new plant were already exported.

Regarding the sustainable development of the Company, in the reporting year we continued to keep our course of implementing ESG initiatives and reducing the carbon footprint. We also successfully continued ESG cooperation with major international partners such as Total Eren S.A, Chevron, Eni and others".

Highlights 2022:

• Oil and gas condensate production increased by 1.7% to 20,012 thous. tonnes;
• Oil transportation increased by 0.1% and amounted to 74,658 thous. tonnes
• Hydrocarbons refining volumes at the Kazakh and Romanian refineries has grown by 5.7% to 19,900 thous. tonnes

Operating results are represented in accordance with KMG's ownership interest in joint ventures and associates and 100% of results for consolidated subsidiaries, unless otherwise stated.

Hydrocarbon reserves

According to reserves report prepared in compliance with international PRMS standards by the international independent firm DeGolyer&MacNaughton, KMG’s proved plus probable hydrocarbon reserves (2P) amounted to 707 mln tonnes of oil equivalent (5,478 mln boe) as of 31 December 2022. Compared to 2021, the level of 2P reserves increased by 9.8%. The increase in indicators is mainly due to the increase in the Company's share in the Kashagan project from 8.44% to 16.88%, the recalculation of hydrocarbon reserves of the Kalamkas and other fields, as well as due to an increase in oil prices.

Upstream

The volume of KMG’s oil and gas condensate production for 2022 amounted to 22,0121 thous. tonnes (456 kbopd), an increase of 1.7% compared to a previous year. Production volume of natural and associated gas (before re-injection volumes) increased by 2.0% to 8,241 mln m³.

Oil production at Tengiz increased by 9.9% and amounted to 5,836 thous. tonnes (128 kbopd). Gas production increased by 9.3% and totaled to 3,229 mln m³. The increase in production was due to production restriction under the OPEC+ agreement in 2021 and absence of the restrictions in 2022.

Total oil production at Kashagan decreased by 21.9% to 12,682 thous. tonnes, due to the scheduled overhaul at the offshore and onshore complexes in the middle of the reporting year and the need to carry out repair and restoration work after a gas leak at the preliminary gas withdrawal unit(“slug catcher”) in August. At the same time, oil production net to KMG increased by 4.3% to 1,402 thous. tonnes (34 kbopd) and sour gas production increased by 7.3% and amounted to 877 mln m³ due to the successful increase of KMG's share in project from 8.44% to 16.88% in 15 September 2022, due to the successful completion of the transaction for the stake buy back in the project from Samruk-Kazyna JSC.

Oil and condensate production at Karachaganak decreased by 2.0% and amounted to 1,013 thous. tonnes (22 kbopd) compared to the previous year due to a decrease in the acceptance of sour gas for processing by the Orenburg gas processing plant, because of extension of scheduled preventive maintenance at its technological facilities. Gas production increased by 2.4% to 1,944 mln m³ mainly due to an increase in sour gas re-injection at the complex gas treatment Unit-2, the commissioning of 4 compressors and an increase in gas processing volumes at the Karachaganak processing complex.

The volume of oil and condensate production at operating assets decreased by 1.4% to 13,761 thous. tonnes (273 kbopd). The decrease in oil and condensate production was due to emergency power outages from the utility company servicing Ozenmunaigas production facilities, as well as natural decline at mature fields. At the same time, the decline in oil production at operating assets was partially offset by an increase in production of 3.6% at Mangistaumunaigas and 2.3% at Embamunaigas. Gas production decreased to 2,190 mln m³ mainly due to the transfer of JSC NC "QazaqGaz" (JSC "KazTransGas") to JSC "Samruk-Kazyna" in November 2021, which includes the gas production asset Amangeldy Gas.

KeyFacts Energy: KazMunaiGas Kazakhstan country profile