Project for gas processing plant at Kazakhstan's Karachaganak estimated at $3.7 bln, implementation to begin in near future
ASTANA. Aug 13 (Interfax) - The construction of a gas processing plant (GPP) at the Karachaganak field in Kazakhstan with a capacity of 5 billion cubic meters per year will begin in the near future, the head of the administration of the West Kazakhstan region, Nariman Turegaliyev, told the Kazakh president.
"In the near future, construction of a gas processing plant with a capacity of 5 billion cubic meters of gas per year will begin at the Karachaganak field. The cost of the investment project is 1.7 trillion tenge," the head of state's press service said following the report on the region's socio-economic development presented to the president.
The construction of the Karachaganak GPP is part of a comprehensive plan for the development of Kazakhstan's gas industry until 2029. The plant will supply the domestic market with commercial gas and reduce dependence on gas imports from the Orenburg GPP in Russia.
As reported, Kazakhstan refused Shell and Eni's participation in the Karachaganak GPP project. The project operator represented by these companies was unable to make a final investment decision on the GPP, the construction of which was originally meant to be completed in 2028. The national company QazaqGaz was appointed as the project operator.
The head of the national company, Alibek Zhamauov, said in early July that the parameters of the future GPP would be substantially changed compared to the original project, and the final cost of construction would become known after the completion of pre-design work in March 2027.
It was originally planned that the plant would be integrated into the Karachaganak field itself, but now QazaqGaz will build the facility 5-10 km from the field itself, he said. Construction is scheduled to be completed by 2030.
A consortium consisting of Hyundai Engineering Co., Ltd. and SICIM Kazakhstan LLP was identified as the EPC contractor for the Karachaganak GPP, and in early July 2026 received a Letter of Award (LOA) from QazaqGaz for the construction of the plant.
The Karachaganak field is one of the largest in the world. Oil reserves amount to 1.2 billion tonnes and gas reserves stand at 1.35 trillion cubic meters. The development of Karachaganak, according to the 40-year production sharing agreement signed in 1997, is carried out by the international consortium Karachaganak Petroleum Operating B.V., consisting of Shell (29.25%, holding a stake through its affiliated company BG Karachaganak Limited), Eni (29.25%), Chevron (18%), Lukoil (13.5%) and KazMunayGas (10%).
Gas from the Karachaganak field is currently processed at the Orenburg GPP. A long-term gas purchase and sale agreement for gas from the Karachaganak field was signed between Karachaganak Petroleum Operating BV and KazRosGas in 2007, and in 2015 it was extended until 2038 for amounts of up to 9 billion cubic meters per year.
QazaqGaz represents the interests of the state in Kazakhstan's domestic and external gas markets. The company is part of the Samruk-Kazyna state fund and manages the infrastructure for the transportation of commercial gas via main gas pipelines and distribution networks.
Hyundai Engineering is a major international EPC contractor (engineering, procurement, and construction) from South Korea, part of the global Hyundai Motor Group conglomerate. The company specializes in the implementation of large-scale turnkey industrial projects.
SICIM Kazakhstan LLP is a major Italian oilfield services EPC company (engineering, procurement, and construction), specializing in the construction and maintenance of oil and gas industry facilities.
The official exchange rate on August 13 is 465.19 tenge/$1.
