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KMG EP Approves 2017 Budget & 2017-2021 Business Plan

Source: www.gulfoilandgas.com 12/21/2016, Location: Asia

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JSC KazMunaiGas Exploration Production (KMG EP) announces that its Board of Directors (“the Board”) has approved the Company’s 2017 budget and 2017-2021 business plan. The budget for 2017 assumes a Brent price of US$45 per barrel and an exchange rate of 360 Tenge per US dollar.

The Company expects free cash flows to be positive in the 2017-2021 period, in contrast to the business plan for 2016-2020 years, as a result of the independent crude oil processing scheme and the reduced volume of domestic oil supplies, as well as changed assumptions on the price of Brent and the exchange rate of Tenge per US dollar, partially offset by increased capital expenditures.

Production
Planned production in 2017 is expected to be 5.8 million tonnes (117 kbopd) from JCS OzenMunaiGas (OMG) and 2.8 million tonnes (57 kbpod) from JSC EmbaMunaiGas (EMG). Thus, the total planned production volume in 2017 from OMG and EMG is 8.7 million tonnes (175 kbopd), a 2% increase on expected production in 2016 due to the comprehensive measures with existing well stock and additional geological and technical measures.

The Company’s share in the planned production of Kazgermunai (KGM), CCEL and PetroKazakhstan Inc. (PKI) in 2017 is 3.5 million tonnes (72 kbopd), which is 7% less than expected production in 2016 mainly due to an anticipated natural decline of production at the PKI and KGM.

The Company expects that by 2021 the annual volume of oil production at OMG and EMG will increase to 6.2 million tonnes and 3.1 million tonnes, respectively, 10% higher than expected production in 2016 due to the comprehensive measures with existing well stock and additional geological and technical measures. Meanwhile, production of KGM, CCEL and PKI is expected to be 3.0 million tonnes by 2021, which is 20% less compared to the expected production in 2016, mainly due to a natural decline of production at PKI by 56%.

Overall, the total combined production of the Company, including its stakes in KGM, CCEL and PKI, in 2021 is expected to be 1% higher than expected production in 2016.

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Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Insurance  Investment  Mergers and Acquisitions  Risk Management 


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