Kazakhstan’s Agency for Protection and Development of Competition (AZRC) has proposed the partial privatization of the Atyrau and Pavlodar oil refineries. According to Rustam Akhmetov, the agency’s first deputy chairman, the proposal involves selling 50% of the state’s stake in these assets.
Current Refinery Ownership Structure
Kazakhstan operates three major oil refineries, located in:
- Pavlodar (northeast)
- Atyrau (west)
- Shymkent (southern region)
The Pavlodar refinery is fully owned by KazMunayGas Refining and Marketing JSC, a subsidiary of the state-owned KazMunayGas (KMG). Similarly, the Atyrau refinery is 100% state-owned through KMG. In contrast, the Shymkent refinery operates under a 50-50 joint venture between KMG and China National Petroleum Corporation (CNPC) through PetroKazakhstan Group.
Shymkent as a Model for Privatization
AZRC cites the Shymkent refinery as the most efficiently operated among the three. “We see a successful example in Shymkent, where 50% is owned by the private sector. Most importantly, private management means fewer government officials in operational roles. As a result, there are significantly fewer accidents, fewer technological failures, and less downtime for repairs. This confirms that private sector management is more effective,” Akhmetov told reporters on the sidelines of Parliament.
He also noted that preliminary discussions on privatization have already taken place within the government.
Oil Refining in 2024
According to the Ministry of Energy, Kazakhstan is expected to refine 17.9 million tons of oil in 2024, yielding 14.5 million tons of oil products. The three main refineries processed similar volumes in the previous year:
- Shymkent refinery
- 5.74 million tons of oil processed
- 2.09 million tons of motor gasoline
- 1.78 million tons of diesel fuel
- 319,000 tons of jet fuel
- 335,000 tons of liquefied petroleum gas
- Atyrau refinery
- 5.5 million tons of oil processed
- 1.6 million tons of gasoline
- 1.6 million tons of diesel fuel
- 188,000 tons of jet fuel
- 213,000 tons of autogas
- Pavlodar refinery
- 5.5 million tons of oil processed
- 1.6 million tons of gasoline
- 1.8 million tons of diesel fuel
- 236,000 tons of jet fuel
- 321,000 tons of liquefied petroleum gas
In addition to these major refineries, more than two dozen mini-refineries across Kazakhstan contribute to oil processing.
Privatization of Other Key Sectors
Akhmetov also revealed that AZRC has recommended the privatization of most municipal utilities in the housing and communal services (HCS) sector, including heat and power plants. Additionally, the agency, in coordination with sectoral government bodies, has agreed to privatize a significant portion of the defense-industrial complex, including firms handling government contracts.
However, some strategically important enterprises will remain under state control. Akhmetov did not specify which companies would be exempt from privatization.
As The Times of Central Asia previously reported, Kazakhstan plans to establish a major defense industry hub at Semey’s tank repair plant, the only such facility in Central Asia.
