Kazakhstan-Mining-Power-Chemicals
Total Page:16
File Type:pdf, Size:1020Kb
KAZAKHSTAN MINING, POWER & CHEMICALS 2016 & CHEMICALS POWER MINING, KAZAKHSTAN KAZAKHSTAN MINING, POWER & CHEMICALS 2016 Power - Mining - Mining Code - Mono-Cities - Exploration Production - Equipment - Services - Chemicals Dear Readers, Our team at Global Business Reports is delighted to present the following cross-industry analysis of Kazakhstan’s mining, power, and chemical sectors. After months on the ground in Almaty, Astana, Karaganda and Ust Kamenogorsk, we have heard from the country’s most prominent executives, officials and thought leaders across three distinct but interlinked value chains. The Central Asian state is endowed with a rich store of natural resources, including oil and a host of metals and minerals. Strategically located at the frontiers of Russia and China, and bearing healthy relations with trade partners across the world including the United States and Western Europe, Kazakhstan has relied on raw material exports to fuel its economy for decades. Yet a fall in oil prices coupled with slowing global growth and geopolitical uncertainty has prompted the state to invest in alternative sources of income and pursue economic diversification. According to the World Bank, the country is likely to grow at an estimated 1.3% this year, down from 4.3% in 2014, highlighting the need for strong policy directives. The state has articulated its commitment to reform, outlining steps to achieve large- scale development and modernization through two programs of accelerated industrial and innovative development. Furthermore, the Kazakh economic policy, known as Nurly Zhol, outlines plans to stimulate the economy through targeted investments in domestic transport, energy, and industrial and social infrastructure. Following through on these objectives will be key in overcoming the downturn in oil prices and increasing the country’s visibility in the global arena. The upcoming Expo 2017, to be hosted in Kazakhstan’s capital city of Astana, will be a timely test of the country’s commitment to change, as well as an opportunity to showcase the country’s non-oil sectorial potential. Kazakhstan Mining, Power & Chemicals 2016 Industry Explorations strives to provide insights into Kazakhstan’s largely undiscovered potential, specifically within the mining, power, and chemical sectors. We hope that investors and policymakers alike will gain insights from our research on the country’s ongoing exploration, its commitment to the adoption of renewable energy, and its burgeoning chemical production within newly established special economic zones. Kazakhstan’s primary goal to rank among the world’s 30 most developed nations by the year 2050 hinges on the success of all three of these key sectors. We would like to heartily thank all of our interviewees, as well as the companies, associations and individuals that we have met with for their support and insights. Sincerely, Katya Koryakovtseva, Project Director Lubo Novak, Journalist Neha Ghanshamdas, Journalist KK LN NG CONTENT Exclusive Interviews Introducing Kazakhstan and its Mining, Kazakhstan's Equipment and Service Government officials, association heads, and Power & Chemical Industries Supply Chain industry executives discuss their organizations’ strategies and provide insight into the Kazakhstani 8. Canny Kazakhstan: A Brief Political and 70. Seeking Quality and Infrastructure economy and heralded mining sector. Economic Overview 73. Interview with Atlas Copco Central Asia 10. Interview with Ministry of Investment and 75. Interview with Borusan Makina Kazakhstan 16, 17, 24, 25, 38, and many more Development, Republic of Kazakhstan 76. Interview with Sandvik Mining and 11. Interview with Ministry of Energy, Republic Construction Kazakhstan of Kazakhstan 77. Interview with Kazzincmash 13. Steppe-by-Steppe: Can Minerals Help 78. Interview with Thrane Teknikk Kazakhstan Diversify Away from Oil and 79. Interview with AK Machinery Gas? 80. Interview with Volvo Group Kazakhstan 15. Expert Opinion Article by Michael Wilson & 81. Interview with Metso Kazakhstan Partners, Ltd. 82. Innovative Service Solutions for Miners in Editorial 18. Interview with Association of Mining and Kazakhstan Metallurgical Enterprises (AGMP) 85. Interview with National Center on Complex Content Processing of Mineral Raw Materials, Republic of Kazakhstan Global Business Reports’ journalists provide Coal is King: Kazakhstan’s Power Industry 86. Interview with KazGeotech unique insights into all aspects of the power, 88. Interview with SGS Kazakhstan and Caspian mining, and chemical industries in Kazakhstan by 22. Tackling Tariffs: Kazakhstan's Slowly Sub-Region working on the ground for months. Evolving Energy Mix 89. Interview with KPSP 24. Interview with AES Corp., Kazakhstan 90. Interview with RJC Group 12, 22, 32, 40, 48, 56, 70, 82, 96, 108 25. Interview with Central-Asian Electric Power 91. Interview with Orica Kazakhstan Corporation (CAEPCO) 92. Interview with MICROMINE & Interview 26. Interview with Batys Transit with GeoMineProject (GMP) 27. Interview with PwC Mining and Power 93. Interview with Leica Geosystems and Specialists, Assurance Dept. Hexagon Mining Division RANK 28. Interview with Det Norske Veritas Kazakhstan 12 KAZAKHSTAN'S WORLD RANKING FOR 8 NATURAL RESOURCES RESERVES Source: Government of Kazakhstan 29. Interview with ILF Consulting Engineers 12 2 Quantitative Oil 14 31. Interview with KB Enterprises A Rough Road to Diversification: Coal 11 Iron Ore 1 Kazakhstan's Chemical Industry Uranium 7 Bauxite 10 Data and Maps Molybdenum 5 Chrome 13 Zinc Shaping the Contours of Kazakhstan's 96. Kazakhstan Invests in its Chemical Sector 11 Quantitative data and maps help readers to Gold Silver Mining Industry 98. Interview with Kazakhstan Petrochemical Copper better understand the underlying trends across Lead Industries (KPI) Inc. all levels of the value chain in Kazakhstan’s 18 KAZAKHSTAN'S WORLD RANKING FOR NATURAL RESOURCES RESERVES 10 34. Transitioning to Privatization, Maintaining 99. Interview with Corrocoat Caspian Source: Government of Kazakhstan power, mining, and chemical industries. 13 1 100. Interview with Evonik Chimia Oil Historical Assets 11 Coal 12 102. Interview with Chemie & Technology Iron Ore 37. Interview with Eurasian Resources Group 3 Uranium 9 103. Interview with Linde Gas Kazakhstan LLP 8, 9, 12, 13, 22,Bauxite 23, 56 18 (ERG) Molybdenum 12 Chrome 104. Interview with BASF Central Asia 11 38. Interview with Government of Karaganda Zinc 10 105. Interview with 3M Kazakhstan & Interview Gold Region Silver Copper 39. Interview with ArcelorMittal Temirtau with Dow Kazakhstan Lead 40. Interview with Kazakhmys Corp. 42. Overhauling Kazakhstan’s Subsoil Regulations Into the Future 44. Interview with Michael Wilson & Partners, Expert Ltd. 108. The Way Forward for Kazakhstan and the 45. Interview with Geomark Global Mining Industry Opinion 46. Interview with Colibri Law 109. Interview with Canada Eurasia Russia 47. Interview with Iluka Resources Business Association (CERBA) Market actors provide deeper insight into the 112. Final Thoughts most important topic facing the mining sector: 114. Company Index the revision of the mining code. The Big Dig: Exploration 115. Credits 50. Slowly Attracting International Players: 15 Mineral Exploration in Kazakhstan 52. Interview with Altay Polymetals 53. Interview with Rio Tinto 54. Interview with Syrymbet 55. Interview with SRK Consulting Kazakhstan Spanning the Periodic Table: Production Future This research has been conducted by Katya Koryakovtseva, Lubo Novak, and Neha Ghanshamdas. 58. Take Your Pick: Mineral Production in Edited by John V. Bowlus Outlook Kazakhstan Graphic design by Gonzalo Da Cunha 62. Interview with KATCO JV Kazakhstan’s variety and depth of mineral A Global Business Reports Publication 63. Interview with Betpak Dala For updated industry news from our on-the-ground teams reserves makes it one of the most important 64. Interview with EuroChem-Karatau around the world, please visit our website at gbreports.com, jurisdictions on the planet. Companies share their subscribe to our newsletter by signing up to our VIP list 65. Interview with Kazphosphate through our website, or follow us on Twitter: @GBReports visions for the future of the industry. 66. Interview with YILMADEN Holding 67. Interview with Deloitte 112, 113 KAZAKHSTAN MINING, POWER & CHEMICALS 2016 - 4 - KAZAKHSTAN MINING, POWER & CHEMICALS 2016 KAZAKHSTAN Industry Explorations • GBR • INTRODUCING KAZAKHSTAN AND ITS MINING, POWER, AND CHEMICAL INDUSTRIES “2015 will be a difficult year for the mining industry and the Kazakh economy in general. The current difficulties will reveal those companies who are properly prepared to withstand the challenges presented by the global economy. Amendments to the Subsoil Law and development of a mining code will be crucial for the development of the mining industry in Kazakhstan.” - Albert Rau, Vice Minister, Ministry of Investment and Development, Republic of Kazakhstan Image: Lubo Novak EDITORIAL Global Business Reports Global Business Reports EDITORIAL Kazakhstan is no stranger to international attention for its raw ranks second among former Soviet republics after Russia, and its signed to make Kazakhstan one of the world’s 30 largest econo- CANNY materials, and it knows how to play the game. This massive coun- oil production ranks 18th in the world. mies, continues. A key pillar of this strategy is identifying new try at the heart of Asia is not only replete with natural resources, Having become a major oil and gas-exporting