The media in Kazakhstan is once again debating the revision of production sharing agreements (PSAs) with foreign companies in the country’s major oil consortia. PSA LLP, the state-owned operator authorized by the Ministry of Energy to represent Kazakhstan’s interests in the North Caspian Production Sharing Agreement, has released new data on revenues from the Kashagan field, information expected to reignite calls to amend agreements with major Western oil producers in Kazakhstan’s favor.

President Kassym-Jomart Tokayev has publicly backed the discussion. In January, he instructed the government to intensify negotiations with foreign investors. “The implementation of production-sharing agreements for large fields has allowed Kazakhstan to become a reliable supplier of energy to the global market. These projects have made a great contribution to the country’s socio-economic development. However, large investments require a long-term planning horizon. Therefore, the government must intensify negotiations on extending PSA contracts, possibly on revised terms that are more favorable for Kazakhstan,” Tokayev said at an expanded government meeting.

The PSA company, headed by Tokayev’s nephew, Beket Izbastin, reported that in 2024, the Kashagan consortium’s total revenue from oil, gas, and sulfur sales exceeded $11 billion. Of this, 80% covered capital and operating costs (“Cost Oil”), while only 20% came from “Profit Oil,” amounting to $2.2 billion. Kazakhstan’s share was 10%, or $220 million. Including the $430 million in taxes paid by the operator, NCOC, the country’s total revenue was $650 million.

“With revenues of $11 billion, the republic’s share, including taxes, was only 6%, the lowest among oil companies not only in Kazakhstan but globally,” PSA said.

Under the current terms, Kazakhstan’s share of Profit Oil will not increase until three billion barrels have been extracted from Kashagan. Only the first billion has been produced over the past decade. Shareholders are expected to begin paying a 30% income tax soon; KazMunayGas has already transferred an initial $45 million payment from the Kashagan profits.

The fairness of this revenue distribution is now a central point of debate. Some observers believe the renewed focus ahead of the next parliamentary session could signal that Tokayev will again raise the issue in his annual address, alongside agreements for Karachaganak and Tengiz, the other pillars of Kazakhstan’s oil sector. Tengiz operates under a contract expiring in 2033, earlier than Karachaganak (2037) and Kashagan (2041).

At his press conference in Astana last month, Prime Minister Olzhas Bektenov confirmed that negotiations with major oil companies had only just begun. “Indeed, there is a view that the country’s interests are significantly infringed upon. We are starting negotiations with our consortium partners to conclude new PSAs for a new period. This will be done in a measured and balanced manner, without sudden moves, while defending the national interests of our country,” Bektenov stated.

The question of what exactly constitutes “national interests” remains open. In February, Mazhilis deputy Edil Zhanbirshin linked the issue to Kazakhstan’s dependence on imported fuel. Despite the $3.7 billion spent on modernizing the country’s three oil refineries, annual processing volumes remain below 18 million tons and are declining, causing recurring shortages of gasoline, aviation fuel, and diesel. Over the past seven years, Kazakhstan has imported more than six million tons of petroleum products, most from Russia.

“We cover this deficit with imports. This is nonsense for a country with such oil reserves. The time has come to solve this problem,” Zhanbirshin said.

How Kazakhstan Compares Internationally

Globally, many major oil producers under PSAs secure far higher effective state takes. According to industry benchmarks, countries like Norway and the UAE often retain 60–80% of net oil revenues, while even more investor-friendly regimes such as Nigeria typically see 50–55%. In contrast, Kazakhstan’s current 6% take from Kashagan in 2024 — even when factoring in taxes — is exceptionally low. This gap reflects the heavy cost-recovery clauses and production thresholds built into the original contracts, signed in the 1990s and early 2000s, when the country sought to attract massive foreign investment to develop technically challenging offshore fields.

The debate over revising PSAs reflects both external and internal priorities: reducing dependence on Russian fuel imports for the Western audience, and ensuring fairer returns on natural resources for the domestic public. Whether this dual strategy will help Kazakhstan move beyond its role as a raw material supplier, however, remains to be seen.