Kazak-Russian Gas Plant Close to Start-Up

Russia’s Gazprom and the Kazak national company KazMunaiGaz will sign an agreement next week to launch a joint gas processing plant in the Russian city of Orenburg, according to the Kommersant newspaper.



Preparations for the launch have been under way for the past ten years. The last agreement to reconstruct the Orenburg plant was reached in 2006, but arguments over gas prices blocked a go-ahead. Gazprom has now caved in and says it is prepared to pay 160 US dollars per 1,000 cubic metres of the gas to be processed at the plant – the highest price it pays for any Central Asian gas. KazMunaiGaz will buy the gas from the Karachaganak field at 33 dollars per 1,000 cu m.



Gazprom pays 100 dollars per 1,000 cu m for Turkmen gas. Most of the gas that comes from Central Asia is exported to Europe via Russian pipelines.