BAKU, Azerbaijan, June 6. Kazakhstan’s Energy Ministry submitted a proposal to freeze purchase prices from subsoil users until 2024 to the Government, Minister Bolat Akchulakov said at the government meeting in the Mazhilis [lower house of the parliament], Trend reports.
“In order to ensure stable gas supply to the domestic market of the country, in 2014 the institution of a national operator endowed with the state's preemptive right to purchase gas produced from oil fields was introduced,” Akchulakov said. “The national operator QazaqGaz NC carries out wholesale sales of commercial gas and unified dispatching of gas distribution through a single gas supply system, based on purchase prices and tariffs for main transportation.”
According to him, this scheme enables the government agencies to keep the price of gas, as well as maintain a stable gas supply in the domestic market. Wholesale gas sales on the domestic market are unprofitable for the national operator. Besides, they are subsidized and directly depend on export revenues.
“For example, from 2015 to 2021, the national operator subsidized the domestic market by 587 billion tenge ($1.35 billion). Current prices are among the lowest in the world. In the context of the development of gas supply, the losses of the national operator grow every year with the growth of consumption,” the official noted.
“The proposal to freeze purchase prices from subsoil users until 2024 will help to curb the marginal wholesale prices for commercial gas for socially vulnerable citizens of the country,” added Akchulakov.