Financial Benefit to Kazakhstan

Since Tengizchevroil’s founding, the company has distributed $103.9 billion to the Republic of Kazakhstan including purchases of Kazakhstani goods and services, profit distributions to KazMunaiGas, taxes and royalties paid to the government, tariffs and fees paid to state-owned companies and employee’s salaries. In 2014, direct payments to the Republic of Kazakhstan totaled $14.7 billion.

Tengizchevroil continues to increase its investment in KC goods and services year after year. TCO spent $415 million on goods and services of domestic producers back in 2002 compared to record $2.4 billion in 2014. TCO has invested more than $17.9 billion on Kazakhstani goods and services since 1993. In the last three years, TCO has seen a fivefold increase in its expenditures on goods. The company will continue to identify methods to increase its purchases of quality goods that meet the extremely challenging operating conditions in Tengiz. Primarily, TCO has been a purchaser of services. This is the area of the most impactful sustainable local content growth now and in the future.

TCO’s motivation in supporting small and medium business entities, oriented in Oil & Gas industry demands, is based on a unique corporate responsibility approach - support production capabilities, become a main consumer of released products and provide opportunities for further sustainable development of entities. TCO has given $9 million in interest-free loans within its small and medium business development program.

TCO has a long-term contracting strategy that will encourage development of Kazakhstani content by its contractors. The company is actively working with the government, KazMunaiGas and industry unions such as the Kazakhstani Union of Machine Builders and also National Chamber of Entrepreneurs to identify and capture opportunities for manufacturers in Kazakhstan. During 2014, TCO identified new Kazakhstani manufacturers and TCO management visited five regions in Kazakhstan and gained a better understanding of manufacturing capabilities of 30 local companies.