Kazakhstan’s state-owned oil and gas holding KazMunaigaz has denied reports it will lose operating control over the country’s gas pipeline operator KazTransgaz following an earlier governmental resolution that passed oversight of the monopoly to state welfare fund Samruk-Kazyna.
The move had been intended to create an operator that could be independent from KazMunaigaz, which is also a major oil and gas producer in Kazakhstan.
The unbundling of the gas pipeline operator was rubberstamped last year by former president Nursultan Nazarbayev as part of a plan to increase transparency in the oil and gas sector.
However, KazMunaigaz said in its latest financial results presentation that the "KazTransgaz share management agreement”, approved by the governmental resolution, will only enable Samruk-Kazyna “to become more actively involved into the governance and management of the gas operator and help addressing [its] strategic challenges”.
The company has stressed that it will “retain full control over KazTransgaz” and “will continue fully consolidating the operator” into its financials.
Besides the direct responsibility for transporting gas to domestic and international customers, KazTransgaz is also involved in purchasing gas from domestic producers and selling it to customers.
According to KazMunaigaz, its pipeline gas transportation volumes fell by 16% to about 87 billion cubic metres last year, however, the volume of gas, sold by KazTransgaz to domestic customers actually rose marginally to almost 23 Bcm.
KazMunaigaz has also reported a significant decline in revenues for the last year, however it remained in profit despite declines in oil and gas production and pipeline transportation.
Revenues dropped by 34% to 4.6 trillion tenge ($10.8 billion) last year as against 2019.
However, the company was able to post net profit of 172 billion tenge against 1.2 trillion tenge in 2019 and also generated free cash flow of 88 billion tenge.