Business & Economy

Kazakhstan cuts reliance on Russian pipelines with China’s help

Astana, Sep 14 (EFE).- Kazakhstan is bolstering its oil industry with China’s assistance to ensure its independence from Russian pipelines, given the risks posed by the conflict in Ukraine to Kazakh crude exports.

“Today, diversifying routes has become synonymous with independence,” Rashid Zhaksilikov, an expert in Caspian region oil and gas projects, told EFE.

To achieve this, Astana has welcomed cooperation with Beijing, especially in the oil and gas sector, which is vital for the country.

Kazakhstan’s National Welfare Fund Samruk-Kazina, encompassing the nation’s leading companies, and China National Petroleum Corporation (CNPC) agreed to launch four major projects in Kazakhstan.

These include the expansion of two oil pipelines: Kenkiyak-Atirau will increase its transport capacity by 6 million tons annually, while Kenkiyak-Kumkol will expand by 5 million tons per year. Both pipelines are part of the crude export line to China, funded by Beijing.

Zhaksilikov recalled that after Crimea’s illegal annexation in 2014, “Russia actively invested in strengthening its oil infrastructure in the Far East toward China.”

“Kazakhstan, on the other hand, wasted these eight years by relying solely on the CPC (the pipeline transporting crude through Russian territory to the Black Sea) and now, in the current situation, is trying to rectify its mistakes,” he explained.

The projects are crucial for Astana, as crude export contributes 70% of foreign exchange earnings and nearly half of the national budget contributions.

In addition to the mentioned pipelines, Kazakhstan hopes to build, with the Chinese oil giant’s aid, a new Beyneu-Bozhoi-Shimketn gas pipeline line, with an annual capacity of 15 billion cubic meters of gas.

This will be complemented by the expansion of the Shiment refinery in southern Kazakhstan, doubling its production capacity to 12 million tons of hydrocarbons, and the construction of a gas plant at Kazakhstan’s largest Kazhagan field in the west, producing 4 billion cubic meters annually.

China’s collaboration isn’t limited to this. China Petroleum & Chemical Corporation (SINOPEC) has already expressed interest in exploring and the Kazakh petrochemical industry, particularly a polyethylene factory in the nation’s west.

According to Kazakh media, between 1997 and 2020, CNPC invested $46 billion in Kazakhstan, followed by corporations like China International Trust and Investment Corporation (CITIC) and SINOPEC.

The process has been challenging due to fears rooted in history and ethnicity from some Kazakh sectors warning about Astana’s excessive dependence on Beijing.

Notably, Astana residents recently protested against Chinese language signs along the route of the future above-ground metro currently being built in the city by the China Railway Asia-Europe Construction Investment company.

The incident, resolved by the removal of the signs, is grounded in concerns over China’s “expansionist aspirations,” which Russian expert Alexei Maslov characterizes as “historical.”

However, Kazakh political scientist Talgat Kaliev told EFE that current Kazakhstan-China relations are “pragmatic and mutually beneficial.”

“We must interact with all our neighbors without mixing economics and politics. It’s vital to see the opportunities ahead of us instead of raising alarms,” he emphasized, noting that Astana and Beijing are geographically linked, urging Kazakhs to “discard any related phobias.” EFE.


(photo) (video)

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