Kazakhstan Plans to Double Oil Refining Capacity by 2040
Key Takeaways
- •Kazakhstan currently has about 18 million tons of annual oil refining capacity, and the plan would lift that to 40 million tons by 2040.
- •Existing refineries are expected to account for 29 million tons a year of capacity after expansion work is completed.
- •A new major refinery is projected to add another 10 million tons a year of refining capacity.
- •The Energy Ministry said the expansion is intended to increase fuel output, improve feedstock use, broaden petroleum product output and reduce imports for some products.
- •Kazakhstan produced 15.47 million tons of fuel last year, above target by 6.3%, and plans to produce 15.49 million tons this year.
Kazakhstan plans to more than double its crude oil refining capacity by 2040 by expanding existing refineries and building a major new plant, the country’s Energy Ministry said on Wednesday, citing the government’s 2025-2040 plan to increase fuel output.
Kazakhstan, a major crude oil producer and member of the OPEC+ pact, currently has 18 million tons of annual oil refining capacity. Under the plan, that figure is set to rise to 29 million tons per year by 2040 through expansions at operating refineries. A further 10 million tons per year would come from the construction of a new major refinery in the country. Total refining capacity is therefore expected to reach 40 million tons annually by 2040, up from about 18 million tons now.
The ministry said the increase in refining capacity will allow Kazakhstan not only to raise fuel output, but also to improve the efficiency of domestic feedstock utilization, broaden the range of petroleum products it produces, reduce reliance on imports for some products, and create new opportunities for the petrochemical industry. That broader push matters for a producer that still balances export-oriented crude production with domestic demand for fuels and refined products.
Last year, Kazakhstan produced 15.47 million tons of fuel, exceeding the government target by 6.3%. This year, the country plans to produce slightly more, at 15.49 million tons.
Earlier this year, Kazakhstan’s Vice Minister of Energy, Kaiyrkhan Tutkyshbayev, said the country plans to commission a new refinery by 2033 in order to eliminate domestic fuel shortages and become a net fuel exporter.
This summer, Kazakhstan has reportedly resisted pressure to export fuels to Russia to help ease the Russian fuel crisis, which was triggered by intensified Ukrainian drone attacks on Russian refineries. Kazakhstan’s hesitation is reportedly linked to the risk of secondary sanctions for supporting the Russian war effort. In addition, the country is facing record domestic demand this summer, Eurasianet reported. The expansion plan now outlined by the Energy Ministry fits into a wider effort to secure domestic supply first, while also leaving room for a larger downstream sector over the longer term.
By Tsvetana Paraskova for Oilprice.com
