Shymkent Oil Refinery

Status: operating (as of July 2022)

General information

Name: Reconstruction and modernization of Shymkent Oil Refinery (2 phases)(*)

Chinese name: 哈萨克斯坦奇姆肯特炼厂一期 (1 stage),

哈萨克斯坦奇姆肯特炼厂二期 (2 stage)

Location: 5 Kapal Batyr St., Shymkent, 160011, Kazakhstan (42°15’36.0″N 69°39’00.0″E)

Project type: oil refining

Owner: PetroKazakhstan Oil Products LLP(*), PetroKazakhstan Inc.(*)

Main Contractor(s): China Petroleum Engineering & Construction Corporation (CPECC) (China); Rominserv (Romania); PetroKazakhstan Oil Products LLP (Kazakhstan)(*).

Sources of financing: China Eximbank ($963,75 mln, stage 1)(*), China Development Bank ($607 mln, stage 2)(*)

Project Cost: $2100 mln(*)

Project Status: operating (as of July 2022)

Project Overview

More than 90% of the equipment for the project was supplied from China

The Shymkent Oil Refinery (SOR) was built in 1985 and is the newest in the country(*). The refinery produces 30% of the total volume of oil products produced in the country.

The project was initiated in February 2014. The main objective of the modernization of the existing refinery was to increase the depth of refining of oil and gas chemical feedstock, through the use of the latest technology and equipment, and to move towards full self-sufficiency in fuel in the country. This is one of the key projects under the joint implementation of the Belt and Road Initiative..

In 2017, after the completion of construction and commissioning of the first phase, the standard of gasoline and diesel fuel was raised from EURO-2 to EURO-4 and EURO-5. In September 2018, work on the second phase was completed(*). More than 90% of the equipment for the project was supplied from China(*). Upon completion of the project, the quality of the fuel produced and the level of environmental safety of production increased, and the design capacity of the plant increased to 6 million tons per year(*).

The management of PetroKazakhstan Oil Products LLP believes that of the three refineries operating in Kazakhstan, the Shymkent Oil Refinery now has the most advanced technology in the field of environmental safety. 20% of the funds invested in the modernization of the refinery went to environmental protection measures. Thanks to advanced technologies, the annual emission of hazardous substances has been reduced from the refinery(*).

PetroKazakhstan Oil Products LLP is included in the List of 50 companies in Kazakhstan with the highest number of harmful emissions(*).

Project impact

Air environment

Total pollutant emissions at the Shymkent Oil Refinery after modernization will be 22,987.9519 tons/year. After modernization of the refinery and increase of oil refining capacity up to 6 mln tons/year, gross emissions at the refinery as a whole decreased by 3,395.0764 tons/year (13%). Emissions of nitrogen oxide, nitrogen dioxide, carbon monoxide from the projected plants decreased by 48%, and emissions of marginal hydrocarbons decreased by 19%.

Aquatic environment

The scale and intensity of impact on groundwater will not change as a result of commissioning of the projected facilities. The content of petroleum products in groundwater samples on the territory of the Shymkent Oil Refinery, in the area of the storage pond and in the Badam River according to the plant monitoring data for 2016-2018 does not exceed MAC. The waters are environmentally clean, the quality of groundwater is stable for the last 3 years.

Land resources

The area of the projected plants is in satisfactory condition, will be arranged, lighted and fenced. Taking into account the technological scheme, fire, environmental, sanitary and hygienic requirements. Indirect sources of pollutants in the soil will be emissions from the sources of the projected installations. The project provides for the use of the latest technologies that reduce emissions of pollutants into the atmosphere.

Plants

The proposed facilities will be located in an area that has already been subjected to intensive anthropogenic impact. Therefore, no particular change in the current ecological situation is expected.

Wildlife

The area of the proposed facilities is located at the industrial site of the Shymkent Oil Refinery, from which large animals and birds have long been displaced. Birds and rodents in the vicinity of the Shymkent Oil Refinery will not experience any change in habitat conditions.

Production and consumption waste

The enterprise does not have its own landfills or long-term waste disposal sites. Wastes are removed by special enterprises as they accumulate. Temporary oil sludge disposal in sludge collectors decreased from 11,73.99 tons/year to 943.096 tons/year. On the expanded territory of the plant 5 new sites for MSW will be equipped on the sites of the projected units.

Socio-economic environment

The priority of the projected production is its operation in line with sustainable development, which implies achievement of maximum economic results with maximum environmental and health safety of the production personnel and the population of the region. Within the framework of the modernization project, the enterprise is working on the reconstruction of treatment facilities. Additional wastewater treatment will save up to 1.5 million m3 of fresh water per year. Reduction of water consumption at the modernization facilities will amount to 9-12 % of the total water consumption. A new 137-meter-high gas flare unit was put into operation, which allows emissions to be better dispersed in the atmospheric air and significantly reduces the load on the environment.

Source: Conclusion of the State Environmental Expertise on the PSD “Modernization and Reconstruction of Shymkent Refinery of PKOP LLP. Adjustment”, 2019.

There were a lot of messages and complaints from the population in local social networks about the suffocating smell in the city at night

A survey of local residents showed that after modernization and increased oil refining, emissions from the plant increased dramatically. There were a lot of messages and complaints from the population in local social networks about the suffocating smell in the city at night (*).

Local authorities conducted an inspection and found no pollutants exceeded (*). There are no automatic air quality monitoring stations near the Shymkent Oil Refinery, and local environmental authorities rely on data provided by the plant itself(*). Similar complaints about emissions have been received from residents of surrounding villages near the plant (*).

Another serious problem for villagers has been the disappearance of water in local springs. This may be a result of the fact that water consumption has increased with increased oil refining at the refinery, and the refinery is actively withdrawing groundwater for its needs(*).

Residents of Shymkent and surrounding villages noted the lack of any prompt environmental information and dialog with them from the refinery management(*). Following an appeal from the environmental community, the Shymkent Oil Refinery was provided with an environmental impact assessment of the project

*Photographs taken by the “Just Journalism”

ECI