Kazakhstan, Astana, Feb. 21 / Trend D. Mukhtarov /
Revision of production sharing agreements (PSAs) in Kazakhstan may lead to disclosure of commercial information about concluded oil and gas contracts, director of Risk Assessment Group, Doctor of Political Sciences Dosym Satpayev believes.
"Despite claims over the tightening of the tax law on subsoil use and a full revision of the contracts signed on Tengiz or Kashagan should not be expected as this creates a danger that in this case, investors will reduce the expenditure for development of fields which will again affect the timing of the first oil," Satpayev told Trend.
Satpayev said Kazakh authorities are trying to establish new rules for investors within the laws that tighten state control and require greater efforts from foreign companies including in the implementation of the approved industrial and innovation programme.
Satpayev noted that a risk emerges of decline in volumes of new investments.
"There is another point. Whether to extend or not contracts with major western transnational corporations in Kazakhstan's oil and gas sector is not only an economic but also a political issue, as behind each of these companies are the interests of influential geopolitical players: USA, Great Britain, France, Russia and others, "Satpayev said.
In his opinion, it is not surprising that Kazakh President Nursultan Nazarbayev said in Washington in 2010 that the U.S. is a major investor in Kazakhstan, and this is why he supported the stability of the existing contracts.
Satpayev recalled that a new law on investments was adopted a few years ago. Article 6 of the old law was abolished. As a result, the state has ceased to undertake obligations not to take actions that would worsen the investors' activity.
"In fact from now on, Kazakhstan has begun forming a new legal framework for the resource sector," he said. "The law on 'Subsoil and Subsoil Use' was adopted," he said.
The Tax Code and other legislative acts envisage the right of the government to unilaterally terminate the contract with a subsoil user including the PSA, in case of a threat to the national economic security of the country.
He added that there are several reasons to change the old rules of the game for investors. First, according to the government, fulfilling the contractual conditions by subsoil users was unsatisfactory.
"The matter rests in delaying the schedule of launching industrial exploitation of fields and raising costs," he said. "Second, the government tried to increase the number of sources of income for the state budget in terms of crisis, primarily due to the mining companies."
Third, the PSA proved to be one of the serious causes of interference in the implementation of state policy to increase the Kazakh content, as the PSA did not include such a thing.
"It appears that the law on 'Subsoil and Subsoil Use' formally comes into confrontation with the PSA," he added.
Earlier, executive secretary of the Kazakh Oil and Gas Ministry Kanatbek Safinov said at a forum of oil and gas companies entitled 'Oil and Gas: Kazakh content 2013' that the Kazakh Oil Ministry will not consider proposals from subsoil users to extend the contracts if they violated fulfilment of contractual obligations.
"We will not consider proposals from subsoil users to extend the contracts if they violate the contractual liabilities within the expert committee and working groups," Safinov said.
He recalled that Kazakh legislation stipulates that any changes are made to the contract only by the companies fulfilling contractual obligations.