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Statute

Approved 
by the Government Decree 
of the Republic of Kazakhstan 
dated 20/05/2010 
No.454 

The Statute 
on the Ministry of oil and gas of the Republic of Kazakhstan

1. General Provisions

1. The Ministry of oil and gas of the Republic of Kazakhstan (hereinafter – the Ministry) is the central executive body of the Republic of Kazakhstan that conducts formation of the state policy, coordination of the management process in the areas of oil&gas and petrochemicals industries, and transportation of raw hydrocarbons. The Ministry has an agency – the Committee of state inspection in the oil&gas industry.

2. The Ministry carries out its activity in accordance with the Constitution of the Republic of Kazakhstan, the laws of the Republic of Kazakhstan, Acts by the President and the Government of the Republic of Kazakhstan, and other normative legal acts as well as this Statute.

3. The Ministry is a legal entity in the legal organizational form of a public institution; it has seals and stamps of its own title in the official language, standard letterheads as well as, in accordance with the legislation, accounts in treasury bodies of the Ministry of finance of the Republic of Kazakhstan.

4. On behalf of the state, the Ministry makes contracts for exploration, production and combined exploration and production of raw hydrocarbons, monitors and supervises observance of their terms by subsoil users.

5. The Ministry enters into civil relationship in its own name.

6. The Ministry is entitled to act on behalf of the state if authorized accordingly in compliance with the legislation.

7. As to matters under its jurisdiction, the Ministry makes decisions following the procedure set by the legislation to be made up in the form of orders by the Minister.

8. The Ministry's staff numbers limit is approved by the Government of the Republic of Kazakhstan with due consideration to staff numbers of state institutions under its jurisdiction.

9. The legal address of the Ministry is as follows: 19 Kabanbai batyr avenue, 010000, Esil district, Astana.

10. The full title of the Ministry is the state institution “Ministry of oil and gas of the Republic of Kazakhstan”.

11. This Statute represents the constituent document of the Ministry.

12. The Ministry’s activity is financed out of the national budget.

13. The Ministry is prohibited to enter into contractual relationship with business entities in terms of performing duties being the Ministry’s functions.

2. The main tasks and functions of the Ministry.

14. The main tasks of the Ministry in its scope of activity are as follows: 
1) to participate in the development and implementation of the public policy in the areas of oil&gas and petrochemical industries, and transportation of raw hydrocarbons; 
2) to carry out inter-sectoral coordination in the areas of oil&gas and petrochemical industries, transportation of raw hydrocarbons, and main pipeline transport;
3) to ensure development of the fuel and energy facilities in terms of raw hydrocarbons,
4) to carry out international cooperation in the context of joint development of hydrocarbon resources including in the Kazakh part of the Caspian Sea shelf;
5) to ensure reproduction of hydrocarbon resources and their reasonable use including associated gas; 
6) to provide for fulfillment of the competence of the authorized body appearing from products sharing agreements.

15. The Ministry performs the following functions according to the current legislation and in line with tasks imposed:
1) pursue the state policy in the areas of oil&gas and petrochemical industries, and transportation of raw hydrocarbons;
2) within its competence, develop and approve policy documents, normative legal acts except for technical regulations, and regulatory and technical documents in the oil&gas industry;
3) along with the state body that administers in the area of natural monopolies and in regulated markets, confirm investment programs and (or) investment projects to be considered when approving tariffs (prices or fee rates) or their limits, and tariff estimates;
4) get involved in the development of national fuel and energy balances in physical terms regarding use of hydrocarbons;
5) design state statistics reporting sheets and ensure, in coordination with the authorized body in the area of state statistics, introduction of the state statistics reporting about volumes and range of production and consumption of energy resources in terms of raw hydrocarbons and indicators of their effective use for enterprises and organizations irrespective of ownership as well as about volumes of associated gas flaring;
6) prepare proposals to the Government of the Republic of Kazakhstan regarding lists of units to be offered for competition including under equity participation of national companies;
7) by commission of the Government of the Republic of Kazakhstan, hold negotiations and make agreements with relevant bodies of other countries which enable execution of contracts, construction, and operation of pipelines and other means of oil exporting transportation within their territories;
8) carry out state regulation of oil production in accordance with field development projects as well as of its turnover;
9) approve employment of capacities of main pipelines and railroad trestles following the principle of fairness of each subsoil user;
10) determine for subsoil users volumes of crude oil delivery to the internal market of the Republic of Kazakhstan to be processed;
11) through schedules (both annual and monthly), determines the amount of oil to be processed in the internal market of the Republic of Kazakhstan in volumes  required to cover the internal market’s need in fuels and lubricants if appropriate;
12) submit annual reports to the Government of the Republic of Kazakhstan about the course of execution of contracts to perform oil operations;
13) define the procedure for drafting and approval of field development projects to produce hydrocarbons;
14) carry out analysis and assessment of risks to harm human life, health, and environment when conducting extraction operations in terms of raw hydrocarbons including the area of transportation;
15) following the set procedure, guarantee the authorized body’s interests in production sharing agreements; particularly, royalty-free trust manage participation shares of the national company’s subsidiary;
16) prepare and arrange competitions where subsoil use rights are granted to conduct exploration, production and combined exploration and production in terms of raw hydrocarbons; makes and executes contracts for subsoil use in terms of raw hydrocarbons;
17) represent interests of the Republic of Kazakhstan in contracts to conduct oil operations pursuant to authorities set by the legislation of the Republic of Kazakhstan; 
18) agree upon calculation techniques for the Kazakh content in respect to the Kazakh personnel; 
19) agree upon the list of top high technological industries to be developed in the Republic of Kazakhstan in the oil&gas industry;
20) in conjunction with interested state bodies, prepare proposals to competition participants regarding the Kazakh content within goods, works, services, and personnel, regarding development of high technologies, new productions and processing facilities, main pipes and other pipelines and their employment during conduct of subsoil use operations and the associated activities, regarding construction and mutual use of infrastructural and other facilities; such proposals are to be included to conditions of competitions for subsoil use rights in terms of raw hydrocarbons; 
21) approve blank forms for yearly plans of purchases of goods, works and services as well as forms for subsoil users in terms of raw hydrocarbons to report on goods, works and services purchased and liabilities fulfilled regarding the Kazakh content in personnel;
22) upon a decision by the Government of the Republic of Kazakhstan, execute the rights of ownership and use of governmental stakes and shares of legal entities that perform their activity under the Ministry’s jurisdiction;
23) ensure observance, within its competence, of  laws and other regulations of the Republic of Kazakhstan in the area of protection of state secrets, mobilization training and mobilization; 
24) approve plans for reclamation and processing of associated gas designed by subsoil users;
25) issue permits to use the liquidation funds to those subsoil users that conduct subsoil use operations in terms of raw hydrocarbons; 
26) monitor and supervise observance by subsoil users of terms of raw hydrocarbons contracts and production sharing agreements including liabilities of the Kazakh content in purchases of goods, works, services and personnel;
27) collect and analyze information about goods, works and services purchased, being purchased and planned to be purchased in the year following the reported period; such information is submitted by subsoil users according to contracts for raw hydrocarbons and (or) by persons authorized by these subsoil users to purchase goods, works and services when conducting subsoil use operations;
28) agree upon working programs of subsoil users in terms of raw hydrocarbons;
29) request information from national identification numbers registers; 
30) supply the authorized body in the area of state regulation of the industrial policy and new technologies with aggregate information about the Kazakh content in subsoil users’ purchases of goods, works and services according to raw hydrocarbons contracts in compliance with the legislation of the Republic of Kazakhstan;
31) agree upon annual working programs of subsoil users in terms of raw hydrocarbons;
32) monitor observance by subsoil users of the procedure to purchase goods, works and services when conducting subsoil use operations.

3. Arrangement of the Ministry’s activity

17. The minister performs management of the Ministry and bears personal responsibility for fulfillment by the Ministry of tasks imposed and execution of its functions.

18. The minister is appointed and dismissed by the President of the Republic of Kazakhstan.

19. The minister shall:
1) define powers of his deputies;
2) appoint and dismiss the head of the committee whose activity shall be under his control;
3) appoint and dismiss deputies of the head of the committee;
4) sign orders;
5) represent the ministry in the Parliament of the Republic of Kazakhstan and other state bodies and organizations;
6) take decisions on other matters within his competence;
7) take measures aimed to curb corruption in the ministry and bear personal responsibility for taking anticorruption measures.

20. The staff of the ministry is headed by an executive secretary appointed and dismissed by the President of the Republic of Kazakhstan on agreement with the Prime-minister of the Republic of Kazakhstan.

21. Resignation of the Government or the minister does not entail termination of the executive secretary’s authorities.

22. In performing his activity, the executive secretary is accountable to the President of the Republic of Kazakhstan, the Prime-minister, and the Minister.

23. The executive Secretary shall:
1) ensure pursuance of the policy formed by the Minister in the areas of oil&gas and petrochemical industries, transportation of raw hydrocarbons, and main pipeline transport and executes his acts and instructions;
2) perform management of the Ministry’s staff: arranges, coordinates and supervises functioning of its units; 
3) arrange informational, analytical, organizational, legal, logistical and financial support of the ministry’s activity;
4) in concurrence with the minister, approve the structure and staff numbers of the ministry and the agency within the staff numbers limit approved by the  Government of the Republic of Kazakhstan;
5) in concurrence with the minister, approve statutes on structural units of the ministry;
6) provide general guidance to the activity of the disciplinary commission, the certification commission, and the competition commission of the ministry; supervise observance of implementation practice and labor discipline, functioning of the personnel service and arrangement of document flows; 
7) with the purposes of facilitating the ministry’s activity and fulfillment of tasks imposed, arrange conduct of public procurement;
8) in concurrence with the minister, appoint and dismiss heads of departments and divisions of the central executive body; 
9) in concurrence with the minister, appoint deputies to the head of the agency upon his proposal;
10) appoint and dismiss the ministry’s employees except for employees whose labor relationships belong to the competence of senior state bodies and officials; 
11) in concurrence with the minister, decide issues of detachment, granting of leaves, cash aids, training (retraining), raising of qualification, promotion, payment of allowances and bonuses to the central executive body’s employees; 
12) in concurrence with the minister, decide issues of disciplinary responsibility of the central executive body’s employees except for employees whose labor relationships belong to the competence of senior state bodies and officials; 
13) ensure elaboration of strategic plans and policy documents of the central executive body to be approved by the President of the Republic of Kazakhstan, the Government and the Minister; 
14) arrange elaboration of the body’s annual action plan and annual report on the results of its activity and submit them for the minister’s approval;
15) ensure preparation of the ministry’s budget call and submission of the budget call to the head of the central executive body who introduces it for consideration by the National budget committee as well as fulfillment of other procedures of the budget process; 
16) provide development of the body’s financing plans and financial statements and approve them upon agreement by the minister; 
17) arrange elaboration of regulations and standards of rendering public services; 
18) arrange development of draft normative legal acts within the Ministry’s competence;
19) set out preparation of findings on draft normative legal acts that came to the Ministry for approval; 
20) represent the ministry in mutual relations with state bodies and other organizations within his powers; 
21) exercise other powers vested by laws of the Republic of Kazakhstan and acts by the President of the Republic of Kazakhstan to the executive secretary.

24. To execute official duties imposed to him, the executive secretary is entitled to:
1) give instructions mandatory for the Ministry’s staff;
2) request and receive from other state bodies and officials any information, documents and materials necessary to solve matters within the competence of the executive secretary;
3) adopt legal acts to be applied individually.

25. The Ministry has a board which is an advisory and consultative body under the Minister. The number and membership of the board is approved by the minister out of heads of the ministry’s structural units.

26. Any other issues pertaining to arrangement of the ministry’s activity as well as rights and duties of officials, competences and powers of structural units that ensure its activity are to be determined by the Ministry’s rules and procedures and regulations on structural units.

4. Property of the Ministry

27. The Ministry has solitary property on the basis of the right of operative management. 
The ministry’s property is formed due to the property transferred to it by the state as well as other assets whose value is shown in the balance sheet of the Ministry.

28. Property assigned to the Ministry is referred to as the national property.

29. The Ministry has no right to alienate it all alone or otherwise dispose of the property assigned to it as well as the property purchased by means of the national budget.

5. Reorganization and liquidation of the Ministry

30. Reorganization and liquidation of the Ministry are carried out in compliance with the legislation.

Keywords: The Statute on the Ministry of oil and gas of the Republic of Kazakhstan

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