1
Development of the Coal Industry and Utilization of Coal Mine Methane
in the Republic of Kazakhstan
27 October 2015
Geneva, Switzerland
Ministry of Energy of the Republic of Kazakhstan
Ministry of Energy of the
Republic of Kazakhstan
2
Current State of the Coal Production Sector in Kazakhstan
2
Ministry of Energy of the
Republic of Kazakhstan
2012 г. 2013 г. 2014 г.
115,6 114.6 108.6
82.8 81.7 78.2
32.8 32.9
30.4
Coal Production 2012-2014 (excluding coal concentrate), mill. tonnes
Coal Production Domestic Consumption Export
Россия
Украина
Китай
Киргизия
Узбекистан
Финляндия
Греция
Russia
China
Kyrgyzstan
Uzbekistan
Finland
Greece
Export Destinations for Kazakh Coal
2012 г. 2013 г. 2014 г.
104.3 102.9 96.6
11.3 11.7 12
Coal Production Volumes by Open-pit and Closed-pit Mining in 2012-2014, mill. tonnes
Открытым способом Подземным способом Open-pit method Closed-pit method Ukraine
3
Coal continues to play an important role in Kazakhstan’s economy over the long term
3
Ministry of Energy of the
Republic of Kazakhstan
(40.00)
10.00
60.00
110.00
160.00
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040
Mill. t
on
nes
Kazakhstan’s Coal Balance
Production Net export Total consumption
• Kazakhstan is a large producer and consumer of coal.
• Currently, coal accounts for 2/3 of country’s primary energy consumption.
• Relatively low production cost (open-pit); the majority of production is low-quality coal.
• However, slow reduction in production volumes is expected after 2020 because of a lack of significant
additional demand.
• Kazakhstan’s coal industry is facing a number of challenges related to keeping its export niche as a result of
continuing increase in competition.
• Typically, 25–30% of produced coal is exported, mostly to Russia, which is projected to reduce its demand
• Opportunities for exporting coal to international markets appear to be limited.
4
Primary Resource Consumption
4
Ministry of Energy of the
Republic of Kazakhstan
Kazakhstan exports 354.6 Mtoe of primary energy resources (2.8% of global consumption), while domestic
consumption is 62.57 Mtoe (0.6% of global consumption)
Kazakhstan’s energy consumption is steadily growing: 30% growth over 10 years, considering the economic crisis
The energy sector accounts for 47.7% of the total primary energy resource consumption
Consumption of primary energy resources by economic sectors
Consumption of primary energy resources in Kazakhstan by type, Mtoe
0 1,000 2,000 3,000
ChinaUnited States
IndonesiaAustralia
IndiaRussian Federation
South AfricaPoland
ColombiaKazakhstan
Mtoe
Kazakhstan: world's 10th largest coal producer, 2013
Natural and
associated gas
Oil products 11,97
Import
Hydroenergy
Coal
Energy sector
Industrial Production Utilities and population
Transportation
5
GHG Emission Trends in Kazakhstan
5
Ministry of Energy of the
Republic of Kazakhstan
0
50
100
150
200
250
300
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
Mil
l. t
on
nes
GHG emissions from energy consumption
Slowing down of GHG emission trends will
require structural reform of the economy and
increased efficiency of energy use
6
Established indicators for GHG emission abatement in Kazakhstan
6
Ministry of Energy of the
Republic of Kazakhstan
1990 2012 2020 2030 2050
Strategic Plan for Development of the Republic of Kazakhstan until 2020 (table, Ch.3. Strategic goals in environmental protection and transition to the ‘green economy’)
Emission reduction to the
level of 2012
Concept for Kazakhstan’s Transition to the ‘Green Economy’ (Fig.1. Ch. Goals and indicators)
Emission reduction to the
level of 2012
-15% compared
to 2012
-40% compared
to 2012
Concept for Development of Fuel and Energy Complex of the Republic of Kazakhstan until 2030 (table, Ch. Goals, tasks and expected results)
Emission reduction to the
level of 2012
-15% compared
to 2012
СО2 emissions from electricity in absolute terms (mill. tonnes of СО2)
137.9* 105.9* 105.9 90.0 63.5
Energy sector CO2 emissions with 1990 as the baseline year
100% 77% 77% 65% 46%
СО2 emission reductions are already established in the main strategic document of the country. In the electricity sector: -23% by 2020, -35% by 2030, -54% by 2050 compared to 1990 г.
*Source: Report of the Republic of Kazakhstan to the UN
7
Extraction of Methane from Coal Seams
7
Ministry of Energy of the
Republic of Kazakhstan
Three companies are implementing the contracts on subsoil
resource use and conducting pilot projects
Industrial production of methane from coal seams is a
complex technical process
CBM projects require substantial investments
8
Utilization of Coal Mine Methane
8
Ministry of Energy of the
Republic of Kazakhstan
1996-2013: 291 mill. m3 of methane, equivalent to
609 thousands of tonnes of coal, resulting in 4
million tonnes of reduced CO2 emissions
Years
Methane is utilized at the following mines: Named after Kostenko, Lenina, Saranskaya, Abayskaya,
Shakhtinskaya
Vo
lum
e o
f u
tiliz
ed
me
tha
ne
, m
illio
n m
3
9
CMM Utilization
9
Ministry of Energy of the
Republic of Kazakhstan
2012 – first pilot installation of electricity-generating engines with
capacity of 1.4 MW at Lenina mine. This installation supplies 20% of
mine’s electricity demand and lowers methane emissions by 6,000
tonnes of CO2 equivalent a year. This is the first installation in
Kazakhstan that generates electricity based on CMM.
Mini-electric station are planned for the following mines of
ArcelorMittalTemirtau: Abayskaya, Saranskaya, Named after
Kuzembayev. Once installed, the total electricity generation from such
installations will be equal to one mine’s annual energy consumption.
10
Required State Support for Successful CMM Utilization:
10
Ministry of Energy of the
Republic of Kazakhstan
To provide legislative and financial support for company initiatives
directed at extraction and utilization of coal methane
To conduct exploration studies of methane reserves at prospective
locations funded by the government
To provide legislative limits for mining at gassy and explosion-prone
seams without pre-degasification of the coal seam through surface
boreholes
To organize training and apprenticeship of local staff abroad at
programs for coal methane extraction
11
Current Activities on Amending the Legislation of Kazakhstan
11
Ministry of Energy of the
Republic of Kazakhstan
The law of the Republic of Kazakhstan, dated January 8 2003, “On
Investments”, partially offers investment benefits for “Production of
Methane from Coal Seam”
There is a need for amendments to the law, since methane production
from coal seams is complex technically and scientifically and is
substantially different from the mechanism used when exploiting gas
reserves and required substantial costs of the investor on organization
of exploration and production of methane
12
Expected Results from Extraction and Production of Methane from Coal Seams:
12
Ministry of Energy of the
Republic of Kazakhstan
Degasification of coal seams and increased safety of
labor at mines (reduced number of fires and
explosions at mines)
Lower ecological impact (reduced quantity of GHG
emissions, as is in line with the Kyoto Protocol)
Utilization of methane in the economy, such as
alternative fuel from an ecologically clean source
Increased level of utilization of alternative sources of
fuel
Creation of additional jobs
13
Joint Seminar in Astana (Kazakhstan) on Facilitating CMM Capture and Utilization
13
Ministry of Energy of the
Republic of Kazakhstan
At the seminar, we discussed questions related to benefits,
such as amending the law to include CMM in the list of sources
that qualify for feed-in tariffs
After the seminar, the GMI provided information that can help
make a more informed decision on feed-in tariffs
At present, based on the information provided by the GMI, the
Ministry of Energy of Kazakhstan is considering inclusion of
CMM in the list of fuels that qualify for feed-in tariffs.
14
Contact Information
14
Ministry of Energy of the
Republic of Kazakhstan
Issatov Sayat, Head of Management of the
Department of the Coal Industry Development,
Ministry of Energy of the Republic of
Kazakhstan, email addresses –
15
THANK YOU FOR YOUR ATTENTION
15
Ministry of Energy of the
Republic of Kazakhstan
