Overview

Date: 2015-10-07; view: 422.

Energy policy of Kazakhstan

Ex. 2

1. Read and translate the text orally.
2. Give explanations/definitions to the following words and word combinations:

Energy resources; energy policy; strategic geographical location; offshore blocks of oil and gas; production sharing agreement; contractor; amendment; tax; government share; foreign participation.

Kazakhstan owns large reserves of energy resources, and therefore the energy policy of Kazakhstan has influence over the world's overall energy supply. Although Kazakhstan has not described itself as an energy superpower, Kazakhstan's president Nursultan Nazarbayev has claimed Kazakhstan will become a factor of energy security in Asia and Europe. Kazakhstan has a strategic geographical location to control oil and gas flows from Central Asia to East (China) and West (Russia, global market).

The responsible governmental agency for energy policy is the Ministry of Energy and Natural Resources. In June 2003, the government of Kazakhstan announced a new Caspian Sea development program, according to which new offshore blocks of oil and gas to be auctioned. In 2005, the government introduced new restrictions granting to the state-owned oil and gas company KazMunayGas status of contractor and at least half of any production sharing agreement (PSA). New tax structure, enforced in January 2004, included a so-called "rent tax" on exports, a progressive tax that increases as oil prices grow. The amendment raised the government's share of oil income to a range of 65-85%.The new structure includes an excess profit tax, and limits foreign participation to 50 percent in each offshore project with no guarantees of operatorship.

In 2005, Kazakhstan amended the subsoil law to preempt the sale of oil assets in the country and to extend the government's power to buy back energy assets by limiting the transfer of property rights to strategic assets in Kazakhstan.