KazMunaiGas Exploration Production contracted out KSP Steel llp for shipment of 29,045 tons of pipes

KASE, April 27, 09/ - KazMunaiGas Exploration Production (Astana), shares of which are present in Kazakhstan Stock Exchange (KASE) official list, disseminated today the press release of April 24, 2009 on the following:

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KazMunaiGas Exploration Production ("the Company" or "KMG EP") signed a direct agreement with Kazakhstan producer on procurement of goods, works and services within the Memorandum of Cooperation, signed in February 2009 at the Forum on Kazakhstan Participation Improvement. The agreement was signed with KSP Steel LLP on shipment of 29,045 tons of pipes.

With the purpose of the Government program implementation aimed at domestic producers support and the increase of Kazakhstan participation in subsurface use projects, KMG EP annually involves local providers to implemented tenders for procurement of local goods. Given this the ratio of Kazakhstan goods producers participation increases year to year. In 2007 it made up 43.14%, and in 2008 already 55.78%.

In 2009 it is being planned to increase the proportion of goods shipment agreements, signed with Kazakhstan producers. Ensuring the mentioned Kazakhstan producers participation will be possible given observance of the certain conditions. In particular, domestic producers must participate in tenders and ensure compliance of products with required technical characteristics and competitive prices.

The stake of Kazakhstan producers participation in provision of services in 2008 made up 99%. This includes - well-drilling, wells capital repairs, geophysical services, technological services at oil operations implementation, exploration works, construction of exploratory wells, etc. Among providers are such companies as KazMunaiGas-Drilling LLP, Burgylau LLP, APF DANK LLP, Geo Energi Group LLP, Holding NTC Geoservice, NPE Avangard LLP, Bolashak Munai Project LLP and other.

In 2009 quarter 1, KMG EP procured goods in Kazakhstan producers to the amount of KZT3,616.6 m. also were procured needed production equipment (subsurface pumps, oil-well tubing, rod rotors, etc) and chemical reagents.