OREANDA-NEWS. January 28, 2015. Kazakh Ministry of Energy is looking for the "golden mean" on the issue of escaping the situation when cheap Russian gas creates unequal conditions for Kazakh oil refineries. This has been stated by Energy Minister Vladimir Shkolnik in the Majilis.

"We are faced with two problems: if cheap gasoline from Russia will rush here, in Kazakhstan - it's good. It is happening now. We set a price limit on the A-92 - 109 tenge per liter, and the price is lower in some gas stations. But then this (cheap gasoline from Russia) will stop our plants, and inflict losses of jobs," Vladimir Shkolnik said during the governmental hour in Majilis.

He said that about 30% of gasoline AI-92 comes from Russia to Kazakhstan today.
"Now all the stores in the country are completely filled with diesel fuel in the amount of nearly 350 thousand tons and gasoline A-92 in the amount of 250 thousand tons. There is replenishment of fuel for the summer. I would not want to step on the rake again. But it is difficult to develop any mechanism, formula, where we can stop and keep adjusting "automatic regime", due to the fact that our main neighbor - the Russian Federation switched to manual control. We consume and bring 30% of A-92 gasoline from Russia, until the modernization does not finish at our plants in 2016. Tax maneuver, approved by the State Duma of the Russian Federation, has been discussed, approved, but not entered into force yet, as there are some moments there," the head of Kazakh Ministry of Energy said.  

"Currently we are working on mending the differences and keeping them in a reasonable corridor. Delegation from Russian Ministry of Energy is arriving today to resolve this situation: on the one hand, not to stop our factories, on the other hand, to provide a sufficient number of cheap gasoline," he concluded.

Ministry of Energy hopes for further reduction of the cost of A-92 gasoline in February.

"I hope for reduction of prices in February. Reduction of prices is already underway in 4 areas. The issue of reducing the marginal price of gasoline is considered," Vladimir Shkolnik said, answering questions from journalists on the sidelines of the governmental hour in Majilis.

He also commented on the question of journalists that at times of falling oil prices in the world the petroleum products prices in Kazakhstan paradoxically do not fall, and confidently stays up.  

"Our prices for gasoline are not kept artificially. We reduced prices twice in December, the cost of gasoline is being decreased in some areas now. We have set price limits, it means it is impossible to increase the price, but it is possible to reduce. Do you understand that the state can not set a price to each refueling," Minister of Energy retorted.

However, he added that today there is a danger that "cheap gasoline from Russia will overwhelm Kazakhstan and our plants will become uncompetitive".

"If you do not let the Russian gasoline, then there is a risk of deficiency, we are importing 30% of the Russian gasoline. In Russia there is a "manual control" prices. And we have to monitor and take measures: to agree on a common quota, a single energy balance. We are doing now," Vladimir Shkolnik said.

Oil production at Kashagan is planned for late 2016.

"Plans are still not changing," Vladimir Shkolnik said, answering questions from journalists on the sidelines of the governmental hour in Majilis.

He also recalled that Kazakhstan plans to produce more than 80 million tons of oil in 2015.

"This year we plan to produce 80.5 million tons. The oil price is quite low now, so it is necessary to take unprecedented measures to reduce production costs, savings on cost, etc.," he concluded.