Resolutions of the Meeting of the Board of Directors
JSC KazMunaiGas Exploration Production (“KMG EP” or the “Company”) held its regular Board of Directors (“the Board”) meeting, where the Board approved a revision of the 2016 capital expenditures plan.
As previously announced, the Company started construction of a gas treatment unit (GTU) for the Prorva group of fields at JSC “Embamunaigas” in 2014. Construction of the GTU will prevent unnecessary gas flaring to comply with the Kazakh legislation, as well as achieve the planned volume of oil production. Commissioning of the GTU is expected by the middle of 2017.
During construction of the GTU, the processing scheme was significantly revised, which resulted in an increased construction area, additional sub-facilities and larger equipment capacity. Moreover, the cost of imported purchased equipment increased due to the switch to a freely floating Tenge from August 2015. Jointly these factors resulted in an increase in overall project costs of 17.9 billion Tenge.
The Board has also preliminarily agreed on the budget for 2017 and business plan for 2017-2021. Further details will be announced following final approval.