Kazakhstan approves new geological exploration program 20 мая 2014, 19:37
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Kazakhstan has approved a new geological exploration program for 2015-2019, Tengrinews reports referring to the Deputy Minister of Industry and New Technologies of Kazakhstan Nurlan Sauranbayev.
"Reserves of some of the mineral deposits in Kazakhstan are very large. Coal and iron are abundant and enough to run for at least another 300-500 years," the Deputy Minister said, adding that efficient use of the deposits was a priority for Kazakhstan.
"In our geological exploration we will focus on precious metals, especially gold, rare earth metals and copper," he said.
The deposits discovered during Soviet era have been developed very intensely over the past decades, but not much geological exploration was done in Kazakhstan since Independence and there are still a lot of promising areas. Besides, with some of the deposits being abundant, other are nearly depleted. For example, Kazakhstan has proven reserves of copper and polymetals enough for only 10-15 years. Therefore, Kazakhstan needs to take urgent measures to replenish its depleted reserves to avoid critical exhaustion of the mineral base that is the material basis for development of Kazakhstan's economy.
The geological exploration program is aimed at enhancing the mineral base by discovering new mineral deposits, improving quality of the available geological data and elimination of leakages in improperly sealed oil and gas wells. Exploration of territories adjacent to the existing single-industry towns like Zhezkazgan and Balkhash and Ulytau district of Karaganda Oblast, all of them in central Kazakhstan, are also one of the priorities of the new program.
Funding of geological exploration has been growing every year. Over $219.8 million was allocated from the state budget for the previous five-year program. And this year the Government allocated about $884.6 million for geological exploration: $653.8 million of them for the new five year exploration program and $230.8 million for Ak Bulak program that is aimed at providing quality drinking water to towns and villages by 2020.
Besides, Kazakhstan's large private and national companies will invest over $4.9 billion in geological exploration at new promising areas in the nearest years. KazGeology, the national exploration company, will collaborate with local companies such as Kazakhmys, Kazakhstan's largest copper producer and one of the leading copper producers of the world, and Kazzinc.
Kazgeology will also cooperate with international mining corporations. They will provide funding and up-to-date equipment and technology for the exploration works as well as training for the local staff.
For example, Rio Tinto, a British-Australian multinational metals and mining corporation with headquarters in London, is going to spend over $13 million on geological exploration at the initial stage of its operations in Kazakhstan. Kazakhstan will also cooperate with Iluka Resources major producer of zircon and titan and South Korean KORES (Korea Resources Corporation).
The Deputy Minister said that a package of amendments has been developed for the Law on Subsoil and Subsoil Use to attract more foreign investments into geological exploration. It will remove many of the existing bureaucratic barriers and improve access to geological information. Kazakhstan is also considering tax incentives for foreign investors.
The draft law is currently in the Majilis, the lower chamber of the Kazakhstan Parliament. By July 1, the Government will also submit a draft concept of the Mining Code, which is developed along with local and foreign experts with the view of increasing the country attractiveness to explorers.
Lack of geological laboratories is another problem for Kazakhstan. Nurlan Sauranbayev said that Kazakhstan was still sending some of its core samples abroad because of lack of duly certified laboratories that would meet the applicable international standards inside the country. Many investors want their geological research done in compliance with international standards. But when core samples are sent abroad, Kazakhstan loses control of information and risks that the foreign companies making the research conceal important parts of the information. As a result, Kazakhstan is not fully aware of what is contained in its subsurface.
To solve the problem Kazakhstan started creating a geological exploration center at the Nazarbayev University territory. In partnership with the university, KazGeology is working out a master plan and making the feasibility study. Construction works will start later this year. The center will have 7 hectares to laboratories, core samples storages and other required facilities. The amount of investments is still being estimated. The Nazarbayev University will be overseeing the project and KazGeology will be in charge of supplying the right equipment that is expected to cost around $4.4 million.
Reporting by Assel Satayeva, writing by Assel Satubaldina, editing by Tatyana Kuzmina