Natural Gas Distribution

Date: 2015-10-07; view: 485.

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Kazakhstan has two separate domestic natural gas distribution networks, one in the west which services the country's producing natural gas fields, and one in the south which mainly delivers imported natural gas to the southern consuming regions. The lack of internal pipelines connecting Kazakhstan's natural gas-producing areas to the country's industrial belt (between Almaty and Shymkent) has hampered the development of natural gas resources. However, as stated above, the development of the Amangeldy gas field will help Kazakhstan's southern region cease importing Uzbek gas. Kazmunaigaz, the state oil and natural gas company operates Kazakhstan's main natural gas pipelines.

In the north, Kazakhstan is developing its ability to export its natural gas through Russia's natural gas pipeline system. Natural gas from the Karachaganak field is sent northward to Russia's Orenburg gas processing plant; however, efforts are currently underway to expand that link and boost export capacity. Some of the gas being sent to Orenburg will then be routed for marketing in the Russian system and some will be sent back to Kazakhstan. In July 2002, Kazmunaigaz, working in conjunction with Gazprom (Russia) under the joint venture KazRosGas, began a $500 million program to upgrade Kazakhstan's natural gas pipeline network. The program, which is being developed with the financial backing of several international banks, will increase Kazakhstan's export capacity in the north, beginning in 2005.

Southern Kazakhstan receives its natural gas supplies from Uzbekistan via the Tashkent-Bishkek-Almaty pipeline. This pipeline snakes through Uzbekistan before reaching Shymkent, crosses Kyrgyzstan, and terminates in Almaty. Dependence on imported natural gas for its southern regions has at times been problematic since erratic pricing and supplies from Uzbekistan, combined with illegal tapping of the pipeline by Kyrgyzstan, have resulted in significant supply disruptions to Almaty in the middle of the heating season. As a result, Kazakhstan is determined to end its dependence on imported supplies for its southern regions. Although Kazakhstan has considered the construction of an internal north-south pipeline, thereby alleviating import dependency, the prohibitive cost (at least $1 billion) of such a pipeline has delayed any decision to proceed with the project.

Since Kazakh natural gas is a potential competitor with Russian natural gas, several new natural gas export pipelines from the Caspian Sea region also are in development or under consideration, potentially opening up new markets for Kazakh natural gas. The two branches of the Central Asia-Centre (CAC) gas pipeline, the main gas export pipeline from Central Asia, meet in the southwestern Kazakh city of Beyneu before crossing into Russia at Alexandrov Gay and feeding into the Russian pipeline system. Therefore, Kazakhstan is a major transit route for gas from Turkmenistan to Russia and on to other markets across the territory of the former Soviet Union.