Kazakhstan and Russia agree to fuel processing deal

Kazakhstan and Russia have reached an agreement regarding the processing of Russian crude oil at the Kondensat Refinery located in the West Kazakhstan region. Under the terms of the deal, approximately 70 percent of the refined petroleum products, specifically gasoline and diesel, will be exported to Russia, while up to 30 percent will be reserved for Kazakhstan’s domestic market.

Kazakhstan’s Energy Minister, Erlan Akkenzhenov, stated that the crude oil will be transported to the facility via railway, as the refinery is not connected to the existing oil pipeline networks of either country. The volume of shipments will be determined by available railway capacity. This arrangement comes as Russia faces fuel supply challenges and rising prices following Ukrainian strikes on Russian refineries.

The Kondensat Refinery, which operates at the Karachaganak field, has an annual processing capacity of 850,000 tons. Kazakhstan aims to significantly expand its domestic oil processing capabilities in the medium term, with a goal of increasing capacity to 40 million tons annually.