Kazakh Upper Chamber gives nod to oil pact with Uzbekistan
Senators of Kazakhstan reviewed and approved the ratification of an intergovernmental agreement with Uzbekistan on some issues of cooperation in the energy sector.
The agreement is aimed at stimulating cooperation in the oil and gas sector, petrochemical and electric power industry, uninterrupted supply of natural gas to the southern regions of Kazakhstan, as well as mutual interest of the parties in developing the transit potential of gas transportation system.
Uzbek side is interested in supplying Kazakh oil in the amount of up to 2 million tons per year. The Uzbek side guarantees the timely completion of the construction of the oil transportation and oil refining infrastructure in Uzbekistan to ensure receipt of the planned volumes of oil.
Moreover, the establishment of a Coordination Council, which will regulate and control the timely implementation of activities, is also provided. The agreement stipulates that the Kazakhstani party, prior to the commissioning of the Shymkent-Dzhizak trunk oil pipeline, levies oil transportation services through the trunk pipeline with a value-added tax at a zero rate.
Oil transportation services through the trunk pipeline are considered by the Kazakh side as international transportation for the purpose of returning the value-added tax in accordance with the tax legislation of Kazakhstan.
The bill was sent for signature to the president of Kazakhstan.