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Kazakhstan Energy Minister Addresses Liquefied Petroleum Gas Production Challenges

in Economy / Kazakhstan - by


The Minister of Energy of Kazakhstan, Almasadam Satkaliev, addressed the situation with the production of liquefied petroleum gas (LPG) in the country during a department meeting on March 5, 2024.

According to the head of the Ministry of Energy, in 2023, the consumption of LPG on the domestic market increased by 400 thousand tons, or 28%, compared to 2022, reaching 2.2 million tons.

Satkaliev highlighted that the wholesale price for LPG is currently below the production cost, ranging from 60,000 to 70,000 tenge per ton. The approved wholesale price for manufacturing plants is 40,320 tenge per ton excluding VAT. Due to the unprofitability of LPG production, the sector is operating at a loss, hindering regular maintenance and modernization investments.

In Kazakhstan, LPG prices are among the lowest, ranging from 54 to 86 tenge depending on the region. To provide context, in Russia, the price per liter of gas is 165 tenge, in Kyrgyzstan – 159 tenge, in Azerbaijan – 171 tenge, and in Tajikistan – 273 tenge.

To ensure uninterrupted supply for the country's domestic needs, an agreement was signed between the Ministry of Energy and Tengizchevroil LLP for the monthly supply of 20 thousand tons of LPG.

It is noted that currently, the National Company "KazMunayGas" and the shareholders of the North Caspian project are working on finalizing a purchase agreement for Kashagan LPG with a volume of up to 700 thousand tons per year by the end of 2024.