ALMATY – Kazakhstan plans to more than double its annual oil refining capacity to 39 million tons by 2040, seeking to move the energy sector toward deeper processing and higher-value products. But the scale of the planned expansion also raises a fundamental question: how will the country secure sufficient economically viable crude supplies for its future refineries while maintaining incentives to invest in exploration and production?
The issue was highlighted at the 13th annual Central Asia and Caspian Oil and Gas Petrochemistry and Refining Summit 2026, where the Ministry of Energy presented the main provisions of Kazakhstan’s Concept for the Development of the Oil Refining Industry for 2025–2040.
The concept envisages increasing annual crude processing from 18 million to 39 million tons and raising the ratio of oil production to refining from 5:1 to 2.5:1. Refining expansion depends on a growing resource base The strategy is intended to modernize and expand refining capacity, increase the depth of crude processing, improve fuel quality and develop petrochemical production.
By 2040, the government targets an increase in refining depth from 89% to 94%, upgrades in motor fuel quality to the K5+ environmental class, and higher production of benzene and paraxylene. The ambition is clear: Kazakhstan wants more of the value generated from its hydrocarbons to come from processing rather than the sale of crude alone.
The economics of supplying those future facilities, however, may prove equally important. Kazakhstan’s Ministry of Energy estimates the country’s geological oil reserves at 13.2 billion tons, of which nearly 4.4 billion tons are recoverable, reported the Kazinform news agency.
These figures are subject to revision as geological exploration continues and reserve assessments are updated. KazMunayGas has launched a large-scale exploration program for 2026–2030, including the drilling of 26 wells, as part of efforts to replenish the country’s resource base.
The question is not simply whether Kazakhstan has oil underground, but whether sufficient volumes can be developed and supplied to domestic refineries on economically sustainable terms. That issue becomes more important as the planned refining capacity approaches 39 million tons annually.
The economics of domestic crude supplies Energy analyst Abzal Narymbetov argues that Kazakhstan’s current fuel-market reforms need to be considered alongside the government’s refining ambitions. In his analysis published on his Energy Analytics Telegram channel, Narymbetov points to the decision to move away from state regulation of fuel prices in February 2025.
According to his account, the reform was intended in part to make supplying crude to domestic refineries economically attractive for producers, helping address chronic fuel shortages and create conditions for investment in refining. “However, the subsequent introduction of an additional excise in December 2025, equivalent to 50% of the additional margin generated by resource holders, and discussion of raising the share to 95%, have raised concerns among oil producers,” he wrote.