21 Nov 2023 19:12

IMF attributes slowdown in Kazakh GDP growth in 2024 to postponing increase in oil output at Tengiz

ASTANA. Nov 21 (Interfax) - The International Monetary Fund (IMF) expects growth in Kazakhstan's GDP to decelerate to 4.2% in 2024 from 4.6% in 2023, attributing the slowdown to delays in the project to ramp up production at the Tengiz oilfield, the IMF said in a statement.

"We expect the growth rate to be more moderate next year. The numbers will be lower than this year. One of the main reasons is the decline in oil production owing to delays in the Tengiz expansion project," Nicolas Blancher, head of the IMF mission for Kazakhstan, said on Tuesday at a press conference in Astana.

"However, in the future, we expect growth to remain between 3%-3.5%. I am talking about non-oil growth. If we take overall growth, it could be different, depending on oil production volumes," Blancher added.

Moreover, global conditions could negatively affect Kazakhstan's economy, Blancher believes.

"I see many risks, both upward and downward [in GDP growth]. Downward owing to a decline in oil production, which is very important for the economy of Kazakhstan. In addition, global conditions, conditions of trading partners, opportunities for oil exports; all this affects the situation. In addition, [...] geopolitical fragmentation could also play a role, including the sanctions factor, which must be taken into account," Blancher noted.

Kazakh Energy Minister Almasadam Satkaliyev in October said that launching the Future Growth Project-Wellhead Pressure Management Project (FGP-WPMP) at Tengiz had been postponed for six months. Satkaliyev clarified that the postponement was owing to the need "to ensure the safety and environmental compatibility of the project". The Energy Ministry will adjust the forecast for oil production for 2024 based on the timeframe to expand the Tengiz oilfield.

The Tengiz oil and gas field is one of the largest in Kazakhstan, with oil reserves totaling 3.2 billion tonnes. It is located in the Atyrau Region, western Kazakhstan.

Tengizchevroil is developing the field. Tengizchevroil is currently implementing a production expansion project and a WPMP at Tengiz, totaling $46.7 billion versus the previously estimated $45.2 billion. The project had been planned for completion at the end of 2022, though the deadline was postponed to 2024 owing to work being behind schedule. The project should boost Tengizchevroil's output by 12 million tonnes per year.

The participants in Tengizchevroil LLP include Chevron with a 50% stake; ExxonMobil Kazakhstan Ventures Inc., 25%; Kazakhstan through KazMunayGas, 20%; and Lukoil , 5%.