Azernews.Az

By Abdul Kerimkhanov

Kazakhstan is the largest republic of Central Asia both by economic potential and by territory. The country is also rich with hydrocarbon sources.

Kazakhstan plans to export up to 5 million tons of oil per year to Uzbekistan, said Minister of Energy Kanat Bozumbayev during a plenary session of the Mazhilis.

He noted that more than 260,000 tons of oil were delivered to Uzbekistan in 2018.

Bozumbayev informed that Kazakhstan is ready to continue to supply oil to Uzbekistan from its own resources through the Kenkiyak-Kumkol oil pipeline and further with transshipment to the railway tank at Shagyr station.

He added that currently, the tariff for this route is $ 25.12 per ton.

The minister noted that in accordance with the Uzbek request, Russia is considering the issue of oil supplies to Uzbekistan in the amount of up to one million tons per year, adding that Kazakhstan in this context is considered as a transit side.

‘‘Uzbekistan is interested in purchasing up to 5 million tons of oil per year, including up to 2 million tons from Kazakhstan and up to 3 million tons from Russia. The option of supplying 5 million tons only from Kazakhstan is also being considered,” added Bozumbayev, presenting the draft law of the Framework Agreement between the Governments of Kazakhstan and Uzbekistan on cooperation in the field of energy.

The minister stressed that for stable oil supplies to Uzbekistan in the amount of up to 5 million tons, Kazakhstan needs significant investments in the transport infrastructure.

With the transit of Russian oil through the territory of Kazakhstan, it is necessary to expand Tuymazy - Omsk - Novosibirsk - 2 (TON-2) oil pipeline from the current 11 million tons to 17.5 million tons per year and reconstruct the Trudovoye oil pumping station, an estimated investment is $ 70.6 million.

Atyrau after the completion of the reverse project to transport oil from the west of Kazakhstan to 8-12 million tons per year, estimated investments - from $121.1 million to $162.5 million. Construction of a new oil pipeline from southern Kazakhstan to the border with Uzbekistan with a capacity of 5 million tons per year, estimated investment equals to $133.5 million.

Taking into account the necessary investments, the minister said, the tariff for the transportation of oil from Kazakhstan to Uzbekistan can reach $ 56.78 - $ 66.54 per ton, with oil transit from Russia of about $ 38.1 per ton.

Bozumbayev emphasized that stable deliveries of Kazakh oil to Uzbekistan are possible only from fields located in the western region of Kazakhstan, mainly from the Tengiz, Kashagan and Karachaganak fields.

This Agreement is a Framework Agreement and the issues of oil supply to Uzbekistan are the subject of additional negotiations between Kazakhstan, Russia and Uzbekistan.

Diplomatic relations between Kazakhstan and Uzbekistan were established on November 23, 1992

Uzbekistan and Kazakhstan agreed to take further measures to ensure the growth of trade turnover to $ 5 billion by 2020. The countries also intend to increase the number of rail, bus and air communication between two states.

Kazakhstan exports to Uzbekistan oil and their products, the milling industry, grain, ferrous, non-ferrous metals, products of inorganic chemistry, as well as food products.

In turn, Uzbekistan exports to Kazakhstan energy sources (gas), cotton fiber, chemical products and plastics, fertilizers, fruits and vegetables.

Uzbek investments in Kazakhstan for the past 10 years amounted to $ 31.3 million, half of which falls for 2016. Kazakh investments in Uzbekistan totalled $ 114.4 million in the past decade.

Over 200 companies with Kazakh capital currently operate in Uzbekistan.

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Abdul Kerimkhanov is AzerNews’ staff journalist, follow him on Twitter: @AbdulKerim94

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