Interview of Brendan McMahon, Managing Director of TOTAL E&P Kazakhstan.
What significance does TOTAL attribute to its operations in Kazakhstan within the context of global TOTAL development strategy?
Kazakhstan holds an important position within the TOTAL development strategy due to its abundant energy potential and the excellent relationship established between the company and the RoK over a long period of time. TOTAL started its operations in Kazakhstan almost straight after the declaration of independence of the young state. Together with other partners TOTAL participated in the largest seismic acquisition in the Caspian Sea, which resulted in discovery of gigantic Kashagan field.
This year TOTAL will celebrate 20th of its operations in the country. Such a long-term partnership has been possible thanks to political stability and well-thought economic reforms of the Government and Head of the State Mr. Nursultan Nazarbayev.
TOTAL is one of the world-wide leaders in exploration, production and processing of hydrocarbons. Participation in complex technological projects like the Kashagan field allows the company to retain a leading position in the sphere of discovery and operation of technically challenging oil and gas fields. TOTAL’s history contains plenty of examples of innovative projects – from complex development of the Lacq sour gas field in France to the introduction of sub-sea separation at the deep-water Pazlflor field in Angola.
What projects serve as the basis of the TOTAL investment project in our country? What stage are they on?
TOTAL E&P Kazakhstan holds 16.81% in the North Caspian Production Sharing Agreement, which includes the Kashagan field, as well as other structures. This project is operated by NCOC (North Caspian Operating Company), where TOTAL plays a leading role. This year we plan to have the first oil from the Kashagan field, which is an important milestone for us. However, a top priority for our company in this project is to ensure industrially and environmentally safe operation. Elsewhere, TOTAL recently expanded its operations in Kazakhstan by acquiring interests in two operated exploration blocks (North and South Nurmunai) in the south of Aktobe oblast. We also continue to strengthen and foster our partnership with the National Company KazMunayGas with whom we actively work on the opportunities of joint exploration projects.
Do you have any plans on further diversification of company investments in Kazakhstan?
The research cooperation with Higher Tertiary institutions like Nazarbayev University, Kazakh-British Technical University, Karaganda State Technical University and Academy of Public Administration under the RoK President is one of the priority spheres that we are developing in Kazakhstan. For instance, Nazarbayev University with the active TOTAL support will open a Solar Energy scientific chair under NURIS (Nazarbayev University Research and Innovation System).
We believe that Kazakhstan has excellent potential for solar and wind energy, biomass, or clean technology related to use of coal. Such ”green“ industries represent interesting perspectives both for Kazakhstan and TOTAL.
As far as we are aware, TOTAL directly supported the creation of the Welding Institute in Kazakhstan. What is the current development of the project to date?
From the moment the initiative was supported by the RoK President Nazarbayev during the Foreign Investors Council in 2009, an extraordinary amount of work has been performed. Kazakhstan became the 55th full-fledged member of the International Institute of Welding; an independent welding association KazWeld has been established; RoK witnessed the inauguration of 5 training centers (in Mangistau and West Kazakhstan regions, Karaganda and Astana), which were certified as per the international training standards; the international audit has been successfully implemented and the right to train international welders of all specializations have been obtained; international certificates of the International Institute of Welding were issued.
Currently the local training centers together with the Contracting Agency of the RoK Ministry of oil and gas have trained over 140 local international welders of the first two levels of specializations; they are currently employed with the major Kazakhstani and international oil and gas companies (Ersai, TCO, KPO, etc.). On April 6th 2013 the grand opening ceremony was held to mark the startup of training course “International welder-engineer” at Karaganda State Technical University (KSTU). Successful completion of this phase of the project will help the Republic to launch the full training cycle for all levels of international welders, ensure transfer of new technologies and expertise in welding (including highly technical spheres), satisfy the demand for highly qualified workforce and foster implementation of the large oil and gas projects, as well as assist in reaching all the objectives set by the President of the Republic of Kazakhstan.
The government of Kazakhstan places a significant emphasis on boosting innovation and technological development of local manufacturing companies. Considering extensive TOTAL experience in this sphere, what most efficient mechanisms could you name?
We fully support the local content policy of the Government of Kazakhstan. Our Welding project – is just one initiative among many. For instance, I would like to mark TOTAL’s Regional Development corporative program, which aims at developing constructive dialogue with local partners and sharing of our experience. These initiatives promote sustainable development, social and economic welfare of local population and improvement of business practices.
In addition, TOTAL is actively involved in the development of bilateral economic relations between France and Kazakhstan. TOTAL’s President for Upstream, Mr. Yves-Louis Darricarrere, is a co-chair of the Kazakh-French Business Council (KFBC). At the last KFBC meeting, which was held in Paris in March of 2013 with participation of RoK Deputy Prime-Minister and Minister of Industry and New Technology Mr Issekeshev, more than 100 French companies participated, representing not only the oil & gas sector, but also such industries as transport, construction, atomic energy, engineering, financial sector, energies, environment protection machine building, telecommunications, pharmacy, etc. At the meeting the implementation of the joint projects, cooperation within public-private partnership framework, transfer of French technologies, investment attraction, tax and customs administration within the Customs Union, and other issues were discussed.
In conclusion, let me summarize that we are confident that maintaining the constructive dialog with the Government of Kazakhstan and close interaction on various industrial and regional initiatives will help not only to foster TOTAL’s business but also to develop sustainable and fruitful cooperation, bring benefits and prosperity to the people of Kazakhstan and assist regional and national economic development.