On June, 24-25 the "Samruk-Kazyna" JSC delegation has visited severalenterprises of the energetic infrastructure of the Turkestan region, including the Shymkent oil refinery plant and the Shardara hydro-electric power station.

On June, 24 members of delegation joined a meeting with the “PetroKazakhstanOil Products” LLP at the Shymkent oil refinery plant. Nowadays the plant provides 30% of total production of petroleum in Kazakhstan. This month the overall repair of the site has been finished. Presentlythe Shymkent oil refinery plantoperates at 92% of its installed capacity.

Generally, after the full-scale modernization that the plant has passed in 2018, its capacity increased by 28% from 4,7 to 6 million tons of crude oil annually. The proportion of light oils has grown remarkably from 58% to 83%, and oil conversion ratio has shown a rise by nearly 16% (from 73% to 88,7%). Nelson complexity index more than doubled from 4 to 8,2.

The Chairman of the Board of the "Samruk-Kazyna" JSC Almassadam Satkaliyev gave the task to senior executives of JSC "NC "KazMunayGas" to take under control scheduled repair of oil refinery plants in Pavlodar and Atyrau, thus, fair supply of POL (petroleum, oil and lubricants) should be ensuredin summer and autumn season.

Also the delegation has visited a methyl-tert-butil-ether(MTBE)-plant of “Shymkent chemical company” LLP, located in the free economic zone “Ontustik”. The plant produces octane boosters used in the production of the emission standard gasoline.

On June, 25 "Samruk-Kazyna" JSC executives visited the Shardara hydro-electric power station that was fully modernized last year by “SamrukEnergo” JSC. The renovation cost 38 billion tenge and resulted in significant increase of station capacity from 100 to 126 megawatt. Meanwhile, hydroenergy production moved upward from 480 to 537 million kilowatt-hour per annum. Reconstruction of theShardara hydro-electric power station improved regional water management and energy supply of local population, along with reducing environmental pressure.

As part of his working trip to Pavlodar region, Prime Minister of Kazakhstan Askar Mamin got acquainted with the implementation of investment projects in the fields of energy, mechanical engineering, metallurgical industry and production of building materials. In Ekibastuz, the Head of Government was reported on the progress of the execution of the instructions of the President of the Republic of Kazakhstan Kassym-Jomart Tokayev on the preparation of the Comprehensive City Development Plan for 2021-2025. The document provides for the implementation of 118 measures to develop a comfortable urban environment, the real sector of the economy, provide employment, improve social and engineering infrastructure, and solve environmental problems. By 2025, it is planned to reduce the dependence of the city's economy on the fuel and energy complex and the mining industry by increasing the share of the manufacturing industry by 4 times – from 5% to 20%. Over 16.5 thousand new jobs will be created in the fields of mechanical engineering, IT technologies, coal chemistry, and the service sector. 932.3 billion tenge is provided for the implementation of the Plan, over 84% of which are private investments. During his visit to Ekibastuz GRES-1, Chair of the Board of Samruk-Kazyna JSC Almasadam Satkaliyev reported to the Prime Minister on the progress of modernization of this largest thermal power plant of the Republic of Kazakhstan, the implementation of the project for the construction of a new power unit No. 3 of Ekibastuz GRES-2, as well as other investment projects in the electric power industry. At Ekibastuz GRES-1, work is underway to restore power unit No. 1 with the installation of electrostatic precipitators. The implementation of the project will increase the plant's capacity by 550 MW to 4,050 MW and significantly reduce the impact on the environment through the use of modern ash and slag removal technologies. The cost of the project is 123.7 billion tenge, while it is planned to shorten the commissioning time of the station and complete the project in 2023. Thus, in total, in the short term, about 1,200 MW of capacities will be commissioned to meet the needs of the growing economy of the Republic of Kazakhstan, the implementation of large industrial projects. The Head of Government was presented with promising investment projects in the mining, metallurgical, coal-chemical and manufacturing industries totaling 227.5 billion tenge, which are planned to be implemented in the industrial zone of Ekibastuz. One of the largest projects of the metallurgical industry in Kazakhstan will be the construction of a ferroalloy plant with a capacity of 240 thousand tons of high-quality ferrosilicon and 12 thousand tons of microsilica per year. The project is being implemented by EkibastuzFerroAlloys LLP in the period 2021-2023. The project cost exceeds 55 billion tenge. During the construction of the enterprise, 1.5 thousand jobs will be opened, and after its launch - 800 permanent jobs. The implementation of the project will increase the export potential of Kazakhstan in the ferroalloy market and will improve the position of Kazakhstan in the world rating of ferrosilicon exporters from 5th to 2nd place. The company Ansa Silicon plans to build a plant for the production of technical silicon with a capacity of 35 thousand tons of products per year. The project cost is over 40 billion tenge, commissioning is scheduled for 2023. About 400 new jobs will be created. The products will be exported to the USA, Japan and the countries of the European Union. The Head of Government visited enterprises for the production of railway wheels (Prommashkomplekt LLP), railway axles and wheelsets (RWS Wheelset), reinforced concrete sleepers and beams (RWS Concrete), fasteners – elastic clips, bolts and screws (FerroTransTrade). The export volume is 70-80% of the production. A new impetus to the development of railway engineering in Kazakhstan will be given by the implementation in the city of Ekibastuz of the project for the construction of a forging and bandage complex of Railcast Systems LLP with the participation of investors from Germany and the Russian Federation. Production capacity – 102 thousand rough tires for locomotives, blanks for large gear wheels and forged products per year. The cost of the project is 70.1 billion tenge, the implementation period is 2024, 600 jobs will be created. The launch of the enterprise will fully meet the internal needs of the Republic of Kazakhstan for the specified products. At the same time, 81% will be exported to foreign markets. In Pavlodar, the Prime Minister got acquainted with the development of production and the implementation of the environmental strategy of Aluminum of Kazakhstan JSC, visited the TemirMash plant for the production of special equipment for various purposes, the ZENITH plant for the production of building materials. Following the results of 4 months of 2021, the volume of industrial production in Pavlodar region increased, in comparison with the same period in 2020, by 4.2% to 573.7 billion tenge, including the manufacturing industry – by 5.9%. The working trip was attended by the Minister of National Economy Aset Irgaliyev, Minister of Industry and Infrastructure Development Beibut Atamkulov, Minister of Energy Nurlan Nogayev, as well as Chair of the Board of Samruk-Kazyna JSC Almasadam Satkaliyev.

Source: https://primeminister.kz/en/news/a-mamin-zhumys-saparymen-pavlodar-oblysyna-bardy-184850

By the decision of the Management Board of SWF Samruk-Kazyna JSC, Yessimkhanov Sungat Kuatovich was appointed Chairman of the Management Board of Samruk-Energy JSC.

The new head of Samruk-Energy JSC was introduced to the team today by the CEO of Samruk-Kazyna Almassadam Satkaliyev.

Previously, Sungat Yessimkhanov held the post of First Deputy Akim of Pavlodar region. Over the years, he worked as Vice Minister of Energy of the Republic of Kazakhstan, Chairman of the Committee for Atomic and Energy Supervision and Control of the Ministry of Energy of the Republic of Kazakhstan, President of Kazakhenergyexpertise JSC, Director of the Department of the Agency for Regulation of Natural Monopolies and Protection of Competition in Mangistau and Karaganda regions.

Graduated from Pavlodar State University named after S. Toraigyrov and the Bolashak Institute.

Starting from April 1, the marginal tariffs of thermal power plants will increase by an average of 15% to finance their modernization, Deputy Energy Minister Kairat Rakhimov said.

The marginal tariffs of 37 of 45 energy-producing organizations (EPO) in Kazakhstan will be increased from April 1, 2021. According to the submitted applications, the growth of marginal tariffs was predicted at the level of 36%. The validity of the submitted applications was analyzed for more than six months.

As a result of the work carried out and discussions, the share of the increase in the declared levels of marginal tariffs of stations was reduced by more than two times.

- When considering them, the ministry applied an individual approach to each case. Applications requiring a timely decision were taken into account. The average increase of marginal tariffs of energy-producing organizations in Kazakhstan is projected at 15%, - Rakhimov said during a briefing at the Central Communications Service.

According to Rakhimov, the most of the energy sources of Kazakhstan were put into operation in the 60-70s of the last century. By the end of 2020, the depreciation of energy assets in Kazakhstan is 53%. Accordingly, the main costs in the generation sector were directed to maintaining them in working order - the level of profitability of most stations is lower than the actual costs.

- particular concern is the quality of the repair companies carried out at power plants, due to underfunding. Unfortunately, the permissible levels of spending on repair campaigns, included in  marginal tariffs, do not fully cover the necessary needs, - Rakhimov stressed.

For this reason, about 2,000 MW are constantly under repair and unavailable for electricity generation for various reasons, which is comparable to the total consumption of three southern regions - Zhambyl, Turkestan and Kyzylorda.

Due to underfunding, there is an increase in the number of accidents and technological outages. In 2020, 4 458 technological violations were committed in the Unified Electric Power System of Kazakhstan (11% increase compared to 2019). Every major technological failure is a risk of an accident of the entire energy system of Kazakhstan.

Timely adjustment of the marginal tariffs at electric power stations will allow for high-quality work on their modernization, as well as timely and fully carry out repairs for the successful passage of the autumn-winter period of 2021-2022 and the reduction of emergency situations.

In addition, the revision of tariffs will help to save about 23 thousand jobs of production personnel of 45 energy-producing organizations, on which the smooth operation and supply of the country and consumers of Kazakhstan with electricity depend. 

Following the operating results for 2020, the financial standing of the largest Kazakhstani power holding company is described as stable despite the impact of the COVID-19 pandemic and a significant change in the economic situation. “Samruk-Energy” JSC is in the “green” zone of credit risk.

According to the Debt and Financial Stability Management Policy of “Samruk-Kazyna” JSC, Samruk-Energy determines the credit risk zone every year - “red”, “yellow” and “green”.

A set of measures allowed the company to reduce its debt burden to “green” and mitigate currency risks. For instance, refinancing of foreign exchange liabilities in tenge – “Moynak HPP” JSC in the amount of 148 mln. US dollars, “Ekibastuz GRES-2” JSC circa 100 bn. tenge. As a result, the share of foreign currency liabilities in the loan portfolio was reduced to 1,5%.

Owing to systematic work on debt management from 2018 through 2020, “Samruk-Energy” reduced its debt by circa 92 bn. tenge in balance sheet terms, which is in line with  target indicators of financial stability ratios set by the shareholder.

Moreover, the introduction of “cash pooling” mechanism by the company had a positive effect, which enable to centrally manage the cash flows of the group of companies, and use internal resources more efficiently, reduce external debt level and decrease external financing costs.

“Samruk-Energy” financial stability indicators are stable despite the presence of negative factors such as the decline in world prices for energy resources, COVID-19 outbreak, maintaining the level of base rate, high inflationary expectations.

As a reminder, the international rating agency Fitch Ratings confirmed the long-term ratings of “Samruk-Energy” JSC at BB level in 2020, the forecast is Stable, and raised the company's credit rating on an independent basis from B to B +.

“Samruk-Energy” JSC is the largest power holding company in Kazakhstan, 100% owned by “Samruk-Kazyna” SWF JSC. It was established in 2007. Core business: electricity and heat production; transmission, distribution and sale of electricity, power coal mining. The holding company comprises energy and coal enterprises, including “Ekibastuz SDPP-1” LLP, “Ekibastuz SDPP-2 Plant” JSC, “Bogatyr Komir” LLP, “Almaty Power Plants” JSC, “Moynak HPP” JSC, “Shardarinsk HPP” JSC, etc.

Ekibastuz power plants GRES-1 and GRES-2, which are the part of “Samruk-Energy” JSC, fulfilled the annual plan for electricity production for 2020 ahead of schedule. According to updated information, total output was 30 531 153 thous. kWh, or 100,4% while the annual plan was 30,413,995 thousand kWh,

The expertise of power engineers and reliable operation of the plant equipment also enabled the supply of 1 050 mln. kWh of electricity to Uzbekistan and Kyrgyzstan, including 300 mln. kWh of electricity in the summer as part of сommodity exchange with Kyrgyzstan to ensure additional water discharge from Kyrgyz reservoirs to provide vegetation irrigation in the lower reaches of the Syrdarya river.

Almost all energy producing organizations of “Samruk-Energy” JSC already fulfilled their annual obligations. Operating in compliance with schedule, "APP" JSC plans to execute the annual plan on December 31. This year, “Shardarinsk HPP” JSC completed a large-scale retrofit project for the main and auxiliary equipment, as a result of which the installed capacity of the HPP was increased from 100 to 126 MW. It is expected that with the seasonal filling of the reservoir and an increase in production, the hydropower plant will reach its full design capacity in January-February.

As regards coal production, the miners of “Bogatyr Komir” LLP, a coal mining company that is managed on a parity basis by “Samruk-Energy” JSC and Russian UC RusAl, are completing the year ahead of schedule. As of December 28, 42 452,4 thous. tons of coal were mined, or 102% of the planned annual production of 41 700 thous. tons.

By the end of 2020, the share of “Samruk-Energy” JSC in the generation of electricity in Kazakhstan is estimated to be 28,7% (last year – 30 200 mln. kWh or 28,5%). The volume of coal production in 2019 amounted to 44,8 mln. tons, or 40% of the total coal produced in Kazakhstan. 

“Samruk-Energy” JSC is the largest power holding company in Kazakhstan, 100% owned by “Samruk-Kazyna” SWF JSC. It was established in 2007. Core business: electricity and heat production; transmission, distribution and sale of electricity, power coal mining. The holding company comprises energy and coal enterprises, including “Ekibastuz SDPP-1” LLP, “Ekibastuz SDPP-2 Plant” JSC, “Bogatyr Komir” LLP, “Almaty Power Plants” JSC, “Moynak HPP” JSC, “Shardarinsk HPP” JSC, etc.

“Samruk-Energy” JSC power companies early fulfilled annual plans by the date of their professional holiday: Ekibastuz GRES-2 generated 4.7 mln. kWh of electricity, which is 107% of the plan, Moynak HPP - over 915 thous. kWh of electricity (104%). Coal output  at the open-pit mines of “Bogatyr Komir” LLP was 41.8 mln. tons (104% of the annual plan).

In general, energy producing organizations of “Samruk-Energy” JSC, while maintaining the growth dynamics of indicators compared to the previous year, as of December 20, 2020, generated 29 897 mln kWh of e (103%), which is 3% higher than the same period last year. This is about 28% of the total output of energy producing organizations in the Republic of Kazakhstan.

In the outgoing year, the company completed or started utmost important projects that actually form the picture of the future of Kazakhstan's energy sector.

In 2020, “Samruk-Energy” JSC completed the program for full retrofit of Shardarinsk HPP. Investments in the project amounted to 38 bn. tenge. The retrofit ensured an increase in the service life of the HPP to 45-50 years and an increase in  from 480 to 537 mln. kWh per year.

“Samruk-Energy” JSC launched the construction of two wind power plants. The first is 60 MW plant in Shelek corridor of Almaty region including a possible increase in the capacity up to 300 MW. The second wind farm is located in Yereymentau district of  Akmola region. It  is planned to install 11 wind turbines with a total capacity of 50 MW at the station site. The electricity generated by the new wind farms will be supplied to the country's National Power Grid.

Over 11 months of the year, energy production by “Samruk-Energy” JSC RES facilities amounted to 303,793 mln.kWh, or 10% of the total volume of electricity from renewable energy sources in the republic.

  “Bogatyr Komir” LLP, a company that is managed on a parity basis by “Samruk-Energy” JSC and the Russian UC RusAl, has begun the implementation of a fundamentally important project at the Bogatyr open-pit mine – Cyclical-and-continuous method of coal mining. The introduction of the production line will allow for coal mining at a depth of more than 200 meters, where the use of railway transport is very difficult and will increase the capacity of the Bogatyr open pit to 40 mln.tons of coal per year.

In 2020, the global issues associated with COVID-19 pandemic affected “Samruk-Energy” JSC group of companies. However, in a difficult epidemiological situation, the company ensured the operation of all its power plants and coal mining facilities as usual. Kazakhstani power engineers The emergency mode showed the high competence of power engineers and mobilization capabilities of the industry.

“Samruk-Enery” JSC strengthened its financial stability 2020. Two years ago “Samruk-Energy” JSC was in the “red zone” of financial stability. The measures taken by the company's management, namely, a significant reduction in its debt, the timely successful refinancing of a foreign currency loan, as well as hedging and converting foreign currency liabilities into tenge, allowed the company to enter the “green zone” of credit risk.

Based on the results of the work conducted, the international rating agency Fitch Ratings confirmed the long-term ratings of “Samruk-Energy” JSC at BB level, the Outlook Stable, and also raised the company's credit rating on an independent basis from B to B +.

“Samruk-Energy” JSC is the largest power holding company in Kazakhstan, 100% owned by “Samruk-Kazyna” SWF JSC. It was established in 2007. Core business: electricity and heat production; transmission, distribution and sale of electricity, power coal mining. The holding company comprises energy and coal enterprises, including “Ekibastuz SDPP-1” LLP, “Ekibastuz SDPP-2 Plant” JSC, “Bogatyr Komir” LLP, “Almaty Power Plants” JSC, “Moynak HPP” JSC, “Shardarinsk HPP” JSC, etc.

“Samruk-Kazyna” SWF” JSC Board of Directors approved the Fund's Development Plan for 2021-2025. This was announced during the briefing by Lyazzat Borankulova, Managing Director for Strategic Development of “Samruk-Kazyna” SWF” JSC.

We would like to remind that Akhmetzhan Yesimov, the head of the Fund, presented  the Concept of transforming the Fund into an investment holding company to the Council for the Fund Management chaired by the First President – Yelbasy on November 13. As part of the Concept, the Fund has identified key goals in the updated Development Strategy of the Fund until 2028. The main one is the transition of the Samruk-Kazyna Fund to a new operation mode as an investment holding company in the medium term, in a manner similar to leading sovereign wealth funds.

So, according to L. Borankulova, the main objectives of the Fund's Development Plan for the next five years will be to ensure financial stability and stability, maintain a sufficient level of liquidity of the headquarters and portfolio companies of the Fund.

L. Borankulova highlighted that in 2021 the Fund will begin active transformation of the Fund into an investment holding company. To ensure the growth of the new portfolio, the Fund will continue to work on the formation of the Fund for Future Generations, as well as begin making direct investments on the principles of co-investment.

According to her, this will enable to start building up commercial assets in the Fund's portfolio. Thus, the Fund will focus on continuing the optimization and restructuring of the portfolio with a full transition to active management of the Fund's investment portfolio by 2024.

L. Borankulova noted that the Fund will begin to actively invest already from 2021. At present, the Fund has identified 12 priority sectors, including information technology, infrastructure construction, green energy, chemical industry, healthcare, mechanical engineering, logistics, agriculture, mining, research and development, and etc. This list is not exhaustive and will be updated annually as global and regional trends and market changes.

According to L. Borankulova, the global crisis has affected the financial performance of the Fund's group. However, Samruk-Kazyna expects to complete 2020 with actual figures well above the initial plans.

“Regardless of the prevailing external factors, in 2021 the key strategic KPI of the company’s group are improving in comparison with the current year estimate. The value of the Fund's net assets in 2021 will increase by 653 bn. tenge and will amount to 14 trn. tenge. The average annual growth rate for the last 6 years is 8.2%, for the last 10 years - 9.1%. The expected growth exceeds the goals of the strategy, which were approved at the level of 8%, ”L. Borankulova said.

It is also expected that the Fund's net asset value will increase by 6.9 trn. tenge by 2025 and will amount to 21 trn. tenge, and the Fund's net income in 2021 will reach 523 bn. tenge, which is 22% higher than the current year's estimate. Over the next 4 years, it is expected to achieve net income in the total amount of 6.2 trn.tenge is planned. Indicator of effectiveness of the capital employed is expected to be at the level of 4.7%, with an improvement by 2025 to the level of 9.1%.

Thus, the Development Plan approved by the Board of Directors fully complies with and supports the implementation of the Fund's development strategy until 2028. Moreover, the Fund's group in 2021 will continue the systematic work that has commenced at the beginning of this year to control the level of expenditures and capital investments.

Reference:

“Sovereign Wealth Fund “Samruk-Kazyna” JSC is a Fund, the sole shareholder of which is the Government of the Republic of Kazakhstan. The fund was established in 2008 by the Decree of the President of the Republic of Kazakhstan and is a commercial structure - an investment holding, the mission of which is to improve the national welfare of the Republic of Kazakhstan and ensure long-term sustainability for future generations. Samruk-Kazyna Fund pursues its mission by implementing its strategic goals and four strategic initiatives, such as increasing the profitability of companies, optimizing the portfolio structure, diversifying income and corporate governance and sustainable development. The Fund's assets amount to about 67 bn. USD. “Samruk-Kazyna JSC group of company comprises enterprises of the oil and gas and transport and logistics sectors, chemical and nuclear industries, mining and metallurgical complex, and power industry

Prime Minister of Kazakhstan Askar Mamin and Chair of the Board of JSC SWF Samruk-Kazyna Akhmetzhan Yessimov took part in Digital Samruk-2020 Conference on the topic "Digital Transformation: Culture of Industrial Innovation’’. The event was also attended by the Minister of Digital Development, Innovation and Aerospace Industry Bagdat Mussin, top managers of the Fund and portfolio companies. The parties discussed the updated approaches to digitalization of the Fund and the Republic of Kazakhstan, and also got acquainted with the results of the implementation of the Samruk-Kazyna Digital Transformation Program. At the moment, the portfolio of the Samruk-Kazyna Digital Transformation Program consists of 71 projects. In addition, this year, a process of constant search for new ideas has been launched — 250 new ideas have been collected, of which 16 have already been transferred to projects. The head of government noted the importance of Kazakhstan being among the 30 leading countries in terms of the level of development of "electronic government" in the UN rating. Through the introduction of only one type of digital technology in the public sector — the system of electronic invoices — the Ministry of Finance increased budget revenues by 400 billion tenge. Mamin emphasized the need to introduce artificial intelligence and Big Data technologies in the areas of tax administration, education, government interaction with citizens and business. He also noted that a single identification center is being created in Kazakhstan, which will allow the population and business to work with government and commercial organizations without the need to provide documents and certificates. Today the center for reengineering of business processes of state bodies began its work. The prime minister emphasized the importance of a qualitative breakthrough in the development of the digital economy of the future and the transition to a platform model in Kazakhstan. The head of government noted that as part of the development of the communications infrastructure, work is underway to provide villages with optical communication lines and mobile Internet. A new ambitious PPP project is starting — providing communication for agricultural and industrial enterprises with an investment volume of 50 billion tenge. These investments will cover more than 100 million hectares of land with communications, which will lead to an increase in yields by 20% and a reduction in costs by 15%. Mamin was reported on the results of the implementation of the Digital Transformation Program of SWF Samruk-Kazyna JSC, including digitalization of enterprises in the oil refining, railway, nuclear and other sectors of the economy of the Republic of Kazakhstan. Akhmetzhan Yessimov, chair of the Board of Samruk-Kazyna SWF JSC, said that the net benefits from the implementation of the Fund's Digital Transformation Program amounted to 128 billion tenge. The Fund's new approaches to digital transformation provide for achieving strategic KPIs and solving key systemic problems in production with an emphasis on improving production processes. The results of the digitalization of oil refineries were cited as successful examples. The change in the system of technological maintenance and equipment repair at the Atyrau Refinery and Pavlodar Refinery allowed reaching a 3-year overhaul period. Benefits for 2019-2020 amounted to 3.5 billion tenge. Digitalization of processes in Inkai LLP, a subsidiary of NAC Kazatomprom JSC, allowed to reduce the time spent on repairs by up to 5%, to reduce equipment failures due to the fault of personnel by up to 15%, and to reduce equipment downtime to 9%. KEGOC JSC automated the management of the Unified Electric Power System modes, Kazakhstan Temir Zholy launched new mobile diagnostic systems for timely troubleshooting, KazMunayGas implemented the Intellectual Field concept. The Foundation also launched training programs for talented youth of Zhas Orken and Digital Summer, which have employed 113 young professionals to date. The programs provide for the opportunity for undergraduate and graduate students of Kazakhstani universities to undergo 2-month internships, and for graduates — 20-month paid internships in portfolio companies of Samruk-Kazyna SWF JSC with further selection for vacant jobs.

Source: https://primeminister.kz/en/news/kr-premer-ministri-a-mamin-digital-samruk-2020-konferenciyasyna-katysty-10111632

The project "Retrofit of Almaty CHP-2 with mitigation of negative environmental impact" as part of which it is planned to transfer the main combined heat and power plant of the southern megalopolis from coal fuel to gas, has passed the next stage. Public hearings were held in Almaty today; the subject of hearings was the degree of impact and consequences of options for upgrading the plant on the environment.

The hearings were held as videoconference with the participation of representatives of the developers of the project’s feasibility study (FS) – “KazNIPIEnergoprom” JSC, the customer – “APP” JSC and the Green Economy Department of Almaty city.

Environmental Impact Assessment (EIA) is a mandatory procedure set out in the requirements of the RK Environmental Code and other regulations.

Full project documentation can be found on the website of "APP" JSC at the link below:

http://www.ales.kz/ru/ustojchivoe-razvitie/153-ustojchivoe-razvitie-2/publichnye-slushaniya/1555-30-10-2020-goda-obshchestvennye-slushaniya-po-obsuzhdeniyu-s-zainteresovannoj-obshchestvennostyu-proekta-predvaritelnaya-otsenka-vozdejstviya-na-okruzhayushchuyu-sredu-k-teo-modernizatsiya-almatinskoj-tets-2-s-minimizatsiej-vozdejstviya-na-okruzhayushchuy

The event began at 11.00 and lasted an hour and a half. Below are some of the key messages from the Hearings.

- CHP-2 is the largest urban heat source, which provides heat supply to 64% of the population and 36% of corporate entities. As at the end of 2019, the installed capacity of CHP-2 is 510 MW, and the heat capacity is 1 Gcal/h. The plant is equipped with eight power boilers. Non-design fuel - Ekibastuz coal - is used as the main one. The annual consumption of coal is about 2,5 mln. tons.

- The difficult environmental situation in the city is associated with annual emissions into the atmosphere - over 123 thous.tons of harmful substances, the main share of which falls on transport: more than 500 thous. city cars and about 200 thous. more from other cities, as well as emissions from CHPP2. The level of existing background pollution of the city is described by an increased content of nitrogen dioxide practically throughout the entire territory of the city, except for Alatau region, as well as a high content of suspended particles in the lower part of the city, in the Zhetysu and Turksib regions.

- The influence of CHP-2 through the volume of gross emissions into the city's atmosphere is, according to various estimates, from 13 to 27%. The zone of influence of the plant’s emissions under unfavorable weather conditions with regard to different substances is circa 15-17 km.

- The retrofit of CHP-2 aims to address the main task of the feasibility study - minimizing the impact on the environment, reducing emissions of harmful substances through the use of natural gas or up-to-date gas cleaning plants when firing coal, which ensure emissions of harmful substances into the atmosphere at the level of EU requirements.

- Based on the results of the Pre-EIA and the economic assessment of the options, an option providing for the transfer of existing CHP-2 to gas is recommended for implementation. The maximum environmental effect is achieved at this option - a 5.5-fold reduction in emissions compared to 2019. At the same time, it is assumed that emissions of sulfur dioxide and suspended particulate matters, typical for coal combustion, will be completely eliminated, the spatial scale of the impact and its intensity, and the risk to public health will reduce.

- Tariffs for heat supplied to consumers are expected to grow at the transfer to gas. This is because of substantially high cost of gas fuel, which exceeds the cost of Ekibastuz coal.

- According to the “Concept for the transition of the Republic of Kazakhstan to a  “green economy”, 2013, existing coal plants are transferred to gas subject to the presence of available infrastructure, gas volumes and economic feasibility.

The feasibility study is currently nearing completion. At the next stage, it is planned to conduct a State independent expert review, including an environmental and sanitary-epidemiologic examination.