Kazakhstan to offset 2025 budget revenue shortfall with 1.4 trillion tenge from Tengiz expansion

ALMATY. Oct 30 (Interfax) - The government of Kazakhstan plans to offset a projected decline in 2025 national budget revenues through the Tengiz Field Future Growth Project, Finance Minister Madi Takiyev said.

"Despite a 3% drop in forecasted 2025 revenues compared to this year, we still expect a total increase of 3 trillion tenge relative to this year's actual revenue. This growth will come from various sources, including economic expansion and contributions from TCO [Tengizchevroil, the operator of the Tengiz field] and the Future Growth Project [FGP] at Tengiz, from which we anticipate 1.4 trillion tenge," Takiyev said at a meeting in the Majilis, the lower house of the Kazakh parliament, on Wednesday.

An additional budget increase of 1.3 trillion tenge is expected through enhanced customs and tax administration, including digital solutions.

"We are now finalizing [the development of] our information systems, which will soon enter pilot operation. Following earlier criticism, we have streamlined down from 14 systems to five. Through digitalization and artificial intelligence, we expect further revenue gains," he said.

Parliament is considering raising mineral extraction tax (MET) rates on uranium, which could add approximately 100 billion tenge to the budget, he said.

"These additional revenues will help us meet our planned targets," he said.

According to the Finance and Budget Committee's report, national budget revenue (excluding transfers) for 2025 is projected at 15.633 trillion tenge.

The Future Growth Project and the Wellhead Pressure Management Project (WPMP) at Tengiz, one of Kazakhstan's three largest oil fields, are being developed by Tengizchevroil. These projects aim to increase TCO's production by 12 million tonnes annually.

Originally planned for completion in late 2022, these projects were delayed, with costs rising from $45.2 billion to $46.7 billion. In April 2024, Tengizchevroil launched WPMP facilities, with the FGP expected to conclude by the second quarter of 2025.

The Tengiz field operator, Tengizchevroil LLP, is owned by Chevron (50%), ExxonMobil Kazakhstan Ventures Inc. (25%), KazMunayGas (20%), and LUKOIL (5%).

The official exchange rate as of October 30 is 491.7 tenge per dollar.