№ 5 (49), 2011 - KazEnergy

tries industrialized, but located far from thesources of supply. In fact construction in Kazakhstanof petrochemical enterprises savesowners of such projects from the millionsand billions of constant costs for delivery ofraw materials to the processing site. In turn,savings in transport costs increases the returnon investment in Kazakhstani oil-gas.And the proximity of the republic to suchgrowing consumers of the products of deepprocessing as China, Russia, the EuropeanUnion provides additional benefits in thesale.It is not surprising that in May this yearThe Korean Company, LG Chem, and Kazakhpublic-private alliance KazakhstanPetrochemical Industries (KPI) signed thememorandum of cooperation in implementingthe second phase project of Atyrau GasChemical Complex (AGCC) in the form of ajoint venture. Korea will provide a loan of $3.01 billion to implement the second phaseof the complex to produce 800 thousandtons of polyethylene. Moreover, the Korean-Kazakh joint venture will invest in the projectadditional $ 1.29 billion equity. And thefirst phase AGKH for 450 thousand tons ofpropylene is already under construction byanother Asian company, Chinese SinopecEngineering. And to finance this project,Eximbank of China provided a loan of $ 1.3billion.Atyrau project for the production of polymersis one of the largest, but not the onlyone planned in Kazakhstan. In addition to anumber of petrochemical facilities for republicrefineries to be constructed in 2015-2017,there are some other plans. For example, aprivate Pavlodar petrochemical company islooking for partners for a project to increasethe production of polymers from 32 tons to 1million tons.The number of industrial projects, based ondeep processing of hydrocarbons is increasingin Kazakhstan, reflecting the globaltrend of long-term rise of the market of petrochemicalproducts. After all, if now theglobal petrochemical industry revenues areabout $ 1.8-2.2 billion per year, by mid-centurythey will grow to $15-20 trillion. Theincreased revenue will not only increase theproduction volumes of products but also aAtyrau project forthe production ofpolymers is oneof the largest,in Kazakhstan.In addition toa number ofpetrochemicalfacilitiesfor republicrefineries to beconstructed in2015-2017steady increase in value. It is obvious thata significant portion of that money will beearned by those market participants, whooptimally use the resource and logisticalspecific of regions when selecting the locationof new production capacity. Just like inKazakhstan...Tanks against balance. Even this brief profileof recent projects makes clear the natureof the new "Eastern" wave of investments inKazakhstan's oil and gas industry. Foreigncompanies are trying to secure a comprehensivepresence in the market. Most likely, becausethey consider the state an attractiveplace to build vertically integrated hydrocarbonbusiness from the crude to the processing.It is clear that a significant role in the country'sinvestment attractiveness plays its legaland tax climate. A typical example is asfollows, the companies from neighbouringRussia this year after the formation of theCommon Economic Space have been activelyre-registering and transferring their businessin the Central Asian Republic. Thesemarket participants imply more lenient taxregime and long-term stability of the politicalsituation in Kazakhstan, avoidant nationaland civil conflicts.Today, when a variety of national groups ofinvestors are directed to Kazakhstan, it isworth recalling that the businessmen fromthe Gulf were among the first foreigners whoafter independence of the Republic saw in itan attractive place for investment and profitfrom the projects in the energy industry. Forexample, investors of the Arab East providedthe birth of the North-Caspian pipeline inthe early 1990s.20 years later Kazakhstan opens up newopportunities for them. Highly profitable investmentsin exploration and refining of thestocks of its oil tanks is a good alternativeto bank safes, as cash holdings are the mostvulnerable part of the capital when the financialcrisis is shaking the global economy.KAZENERGY55