The Energy Jigsaw

BG Group has been active in Kazakhstan for nearly 20 years. How would you describe BG’s contribution to the realization of the country’s full energy potential?

BG has been operating in the country since 1992. Our current focus is the Karachaganak field. We are a joint operator in Karachaganak with ENI, and it is the biggest gas condensate field. Chevron and Lukoil have also joined. We have significantly developed the field, forging technology and foreign expertise. This has been a very successful project, and it has performed extremely well not only in terms of production, but also in terms of safety and profit generation. It is a major impetus for the economy with many positive impacts.

How would you evaluate the maturity levels of the field?

There is a lot of development to go, and we are still in a major investment phase. So far only 10% of the hydrocarbons have been produced. To develop the field optimally we have been engaged in strong and cooperative discussions with the government.

In 2009 the shareholders in the Caspian Pipeline Consortium (CPC) agreed to expand the pipeline’s capacity. What implications does this have for your plans in Kazakhstan?

It has been a long and hard process, but we have made a good level of progress on that front. It has taken six years to bring it to where it is now. It is an important project for Russia, Kazakhstan, and BG Group. It constitutes a huge step for Kazakhstan with regard to gaining access to world markets. It also is an important part of Kazakhstan’s energy jigsaw. It will bring in additional demand for Karachaganak, facilitating the realization of the field’s full potential. CPC as it is now is already very important, as a lot of Kazakhstan’s wealth is passing through it.

Kazakhstan is a producer and a transit country at the same time. What is your vision for Kazakhstan emerging as the region’s energy hub?

Kazakhstan is already an energy hub for the region. Any enhancement of its position as an energy hub depends to some extent on additional gas infrastructure, which is tied to the enactment of new legislation. In any case, Kazakhstan is well positioned to play an increasingly more important role.

What are your long-term objectives for BG Group in Kazakhstan?

The long-term objective is to continue our focus on Karachaganak. We are ready to invest there under the right terms and conditions. We are also looking at other projects in Kazakhstan. We are also interested in other countries such as Turkmenistan. Our aim is to increase our number of local employees to 80%, making this a fully Kazakhstani firm. With regard to expertise, education, and training in Kazakhstan, we try to develop it as fast as the sector and business can accommodate, so that new graduates can take over roles in our businesses. We cannot develop without developing the local economy. Our efforts have been reflected in our performance and reputation. The American Chamber of Commerce honored BG as the best foreign investor in Kazakhstan, and we have also received praise for our environmentally conscious business approach.