The Week in Kazakhstan: Burning Question

On July 14, Kazakhstan’s government said it planned to enforce an environmental fine against the operators of one of its largest oil fields.The foreign-led consortium at Kashagan said on July 15 that the ongoing arbitration proceedings concerning the fine prohibit its enforcement.The following day, the ministry of justice said the consortium’s statement is unfounded.In 2023, the government fined Kashagan’s operators 2.33 trillion tenge ($4.9 billion) for breaching sulphur storage limits.Disruptions to the Druzhba pipeline led the German refinery in Schwedt to import Latin American oil instead of Kazakh crude, Polish fuel company Unimot said on July 13.Since 2023, Kazakh oil has been pumped to Germany across Russia via the Druzhba pipeline.In April-May, drone attacks disrupted the pipeline and prompted the German refinery to look for crude oil from Latin America, shipped through the Polish port of Gdansk.The Semey Ormany nature reserve is burning.On July 17, the ministry of ecology said that around 370 hectares had been lost to wildfires over the course of two days.In 2023, forest fires affected 60,000 hectares of the Semey Ormany area.Kazakhstan’s President Kassym-Jomart Tokayev flew to Shanghai to attend the World Artificial Intelligence Conference on July 16.Tokayev met with Chinese President Xi Jinping to discuss new forms of cross-border e-commerce and new avenues for cooperation in the energy and mining sectors.Shareholders of Kazakhstan’s mining giant ERG could split the company into two entities, one focused on the domestic market and the other on operations abroad, Bloomberg reported on July 10.In May, businessman Shakhmurat Mutalip bought a 39% stake in ERG from the families of Patokh Chodiev and Alexander Mashkevich, who had co-founded the conglomerate.Shukhrat Ibragimov, who holds a 20% stake, could splinter off ERG’s Congo operations.Kazakhstan’s government owns the remaining 40% in ERG.The tax reform in Kazakhstan led to an increase in registered entrepreneurs, the minister of economy said on July 14.The number of registered business entities increased by 20% in the first six months of the year, after the reform entered into force.According to Serik Zhumangarin, this led to an increase in the number of entities paying VAT, which was increased from 12% to 16% in January.Kazakhstan’s Central Bank lifted on July 15 requirements for quasi-state companies to sell 50% of their foreign currency income on the domestic market.The measure, introduced last year, was one of several aimed to support the national currency, the tenge, whose exchange rate against the US dollar has weakened over the past few years.Central Bank head Timur Suleimenov reassured that the decision should not significantly affect the exchange rate.At a cabinet meeting on July 14, Prime Minister Olzhas Bektenov said he was dissatisfied with the slow pace of modernization at a thermal power plant in Almaty and a combined-cycle power plant in the Turkestan region.The original plan was for both plants to be commissioned by the end of the year, but delays have put the deadline in jeopardy.Bektenov told the ministry of energy and the national holding Samruk-Kazyna that “if you do not finish by the end of the year, your personal accountability will be addressed.” Tokayev replaced two governors on July 17.Yeset Baiken was named governor of the Ulytau region, after serving as deputy mayor in Astana.He replaced Dastan Ryspekov, who had been governor since 2024.The former head of the KAZENERGY lobby group, Bolat Akchulakov, was appointed governor of the oil-rich Atyrau region.Akchulakov replaced Serik Shapkenov, who had served since 2022.On July 13, a local court extended the pre-trial detention term for Chechen activist Mansur Movlayev to 20 months, beyond the maximum allowed 12 months.Movlayev was detained in May 2025 in Kazakhstan at the request of Russian authorities.According to his lawyers, Movlayev faced persecution in Russia for criticizing the authorities in Chechnya.Father Iakov Vorontsov, an outspoken critic of Russia’s war in Ukraine and the proponent of a separate Orthodox Church in Kazakhstan, was transferred from a psychiatric hospital to a detention facility, Kazakhstan’s Bureau for Human Rights reported on July 13.Father Iakov was arrested in February and subsequently charged with drug trafficking.He was then sent to a psychiatric hospital for two months.Sign up for our English-language newsletter.