Tengizchevroil LLP (hereinafter – TCO) broke its own record by reaching a 71% local content score in procurement, driven by increased purchases from domestic suppliers. It was announced by Konilkosh Suyessinov, Deputy General Director of TCO, during the KAZENERGY Energy Week - the XVI Eurasian Forum KAZENERGY.
One of the discussions at the XVI Eurasian Forum KAZENERGY was the development of Kazakhstani manufacturing companies and all the “three giants” of Kazakhstan’s oil and gas sector presented to the guests of the forum their initiatives and programs for developing the local content, especially in goods.
“TCO recognizes that Kazakhstani Content (KC) is a strategic issue for the country, and by supporting it, we will continue to work to increase Kazakhstani content in goods, works and service”’ – Konilkosh Suyessinov emphasized in his speech.
Since 1993 TCO spent more than $51.4 billion on Kazakhstani goods and services. The spend is very diverse and goes beyond Atyrau, stimulating economic activity in several regions across the country. Also, it is worth to mention that TCO is making solid progress on increasing the KC spend on goods – for the first half of this year it reached 9%. And company is currently by far the number one purchaser of local goods when considering the actual value of money spent when compared to the percentage.
TCO will continue to work on the goods performance. TCO in collaboration with the Ministry of Energy has developed an In-Country Value Development Program in goods, works and services, which has become the foundation of KC delivery in the next 5 years.
It is also worth to mention that TCO allows for minor price deviations in favor of domestic producers when procuring materials.
Also, under the updated TCO procedures, suppliers requesting non-standard payment terms such as advance or milestone payments, for high-value or high-risk contracts, may now provide bank guarantees not only from international banks but also from second-tier Kazakhstani banks.
Since 2024, TCO has completed the qualification of 16 Kazakhstani manufacturers and included them in the TCO Approved Manufacturers List, recognizing them as meeting TCO’s requirements and standards.
The main goal of the supplier development program is to support the professional growth of Kazakhstani suppliers by addressing gaps between their current capabilities and TCO’s requirements for goods, works, and services.
Success story of Kazakhstani companies
Tengizchevroil proudly announces that its business partners, PSI Energy and QMOZ (Qarassay Mashina Ondiru Zauyty) have safely completed the first Substation fabrication completion. These two-story, 38m long buildings are the largest modular substations constructed in Kazakhstan and represent over 800,000 workhours executed without any Lost Time Incidents (LTI). Each module, weighing up to 92t, has been fabricated, assembled, and fully tested in Kazakhstan.
One of the modules has already been installed at Tengiz, the second Substation will be delivered and installed till the end of October.
Once in operation these Substations, made by Kazakhstani companies will support the safe and reliable operations of the KTL Production Facilities for many years to come.
In addition to the internal efforts, TCO actively collaborates with the International Machine-Building Center (IMBC), where 12 product groups have been developed by the three main oil and gas operators. IMBC evaluates and supports the development of local manufacturers in these categories.
And as a result of work with IMBC last year, TCO signed long-term contracts for the supply of MRO (Maintenance, Repair, and Operations) and protective materials. Several associated memorandums and agreements are currently in the process of implementation.
The work with IMBC will continue and the updated performance will be provided at the upcoming IMBC Forum in Aktau.
Development of the Kazakhstani content is a strategic issue, and TCO will continue to partner closely with industry and government to achieve this common goal.
