“SAMRUK-ENERGY” JSC | Integrated ANNUAL REPORT

Investment activity

The implementation of a large-scale “Samruk-Energy” JSC assets development program, as well as relatively recent dates of commissioning of generating facilities, determine the high technological level of the equipment used, with high total deterioration in the Republic of Kazakhstan. Subject to an increase in the level of load and the continuation of implementing the investment program, “Samruk-Energy” JSC may become the leader in the operational efficiency of the Republic of Kazakhstan’s power sector.

Simultaneous development of advanced coal-fired power units. maneuvering facilities, cogeneration and future energy (RES) allows the Company to establish itself firmly as a market leader, while implementing RES projects together with a strategic partner.

The investment program of “Samruk-Energy” JSC is aimed at modernization, reconstruction and construction of generating facilities, as well as ensuring reliable energy supply and meeting the needs for electricity and heat.

Investment costs, mln. tenge

The Company uses various tools, such as external loans and bonds, to finance the Investment Program, and raises funds from State budget for financing socially important projects.

In accordance with “Samruk-Energy” JSC mission, in order to ensure reliable and competitive energy supplies in the territory of the Republic of Kazakhstan, increase the shareholder value and ensure social responsibility of “Samruk-Energy” JSC business, the following investment projects were implemented during 2018.

The project “Construction of 1 MW SPP and 5 MW WPP under the Agreement between the RK Government and PRC Government”

The project was implemented as part of provision of technical assistance as a grant assistance to the RK Government by PRC Government. The project aims to produce 18 mln. kWh of electricity per year using renewable energy sources (5 MW WPP annual output is circa – 17 mln. kWh; 1 MW SPP annual output is circa – 1.4 mln. kWh). An opening ceremony was held on the territory of the FEZ “PIT Alatau” near the village of Nurly of Almaty region on November 30, 2018

The project “Transfer of 220 kV "Gorny Gigant" substation’s load to 220 kV "Yermensay" substation through 110 kV grids followed by dismantling of "Gorny Gigant" substation”

The project provides for the elimination of threat of the existing substation damage, the reliability of power supply to the central part of Almaty city. Due to the threat of an emergency at Gorny Gigant substation because of landslides and soil destruction at the base of the substation, it is planned to connect all 110 kV outgoing lines from "Gorny Gigant" SS to existing "Yermansay" SS, followed by dismantling of "Gorny Gigant" SS.

December 22, 2018, the transfer of "Gorny Gigant" SS load through a 110 kV grid to "Yermansay" SS was fully completed. The project’s goals were accomplished.

The portfolio of ongoing investment projects of the Company includes 9 investment projects, the implementation of which will enable to make up the deficit of Kazakhstan in electricity and capacity by increasing the installed capacity of available plants and establishing new facilities.

The project “Transition to cyclical-and-continuous method (CCM) for extraction, transportation, blending and loading of coal at “Bogatyr” open-pit coal mine of Ekibastuz coal field”

CCM project assumes a step-by-step transition of the “Bogatyr” mine to the cyclical-continous technology of coal mining and delivery by conveyor transport to the blending warehouses with subsequent loading on the surface loading units. The need to implement the project is related to the achievement of the depth of mine works, at which the use of rail transport becomes less effective.

The implementation of the project will allow increasing the production capacity of “Bogatyr” open-pit coal mine from 32 to 40 mln. tons of coal per year, improving labor productivity, reducing cost of coal mining and upgrading premises and equipment relating to transportation and unloading of coal.

The project “Development of the gas field “Pridorozhnoe”

The project provides for the construction of infrastructure for the production of natural gas for sale to domestic and foreign markets. The project also plans to build a high-pressure gas pipeline from Pridorozhnoe field to the Beineu – Bozoy – Shymkent gas pipeline.

The aim of the project is to cover the deficit of gas demand in the South Kazakhstan region of the Republic of Kazakhstan, with the maximum annual gas production amounting to about 290 million m3.

On July 30, 2018, the Contract for gas extraction was signed with the RK Ministry of Energy.

The project “Modernization of Shardarinsk HPP”

The project involves the replacement of obsolete and worn-out equipment to improve performance and operational safety of the plant, which will increase the installed capacity to 126 MW and produce an additional 57 million kWh of electricity per year. The project equipment was supplied, installation works are underway

The project “Construction of SES 416 kW in Kapshagay”

The project involves the construction of a 416 kW solar power plant in Kapshagay city using photovoltaic modules based on Kazakhstan silicon produced by “Astana Solar” LLP. The project will produce an additional 0.5 million kWh of electricity per year. The goal of the project is to produce electricity using renewable energy sources to provide electricity to South zone of Kazakhstan that experiences power shortages.

Design and estimate documentation of the project was developed, it is planned to carry out construction and installation works.

The project “Expansion and reconstruction of Ekibastuz SDPP-2 with the installation of power unit No. 3”

The project provides for construction of power unit No. 3 with an increase in the installed capacity of the plant by 636 MW and the production of an additional 4.8 billion kWh of electricity per year.

The project “Reconstruction and expansion of the capacity of Ekibastuz SDPP-1 (Restoration of power unit No. 1)"

The project involves the restoration of 500 MW power unit No. 1 at Ekibastuz SDPP-1 to meet the growing demand for electricity in Kazakhstan and Russia.

The project “Construction of 50 MW wind power plant near Ereymentau city”

The project provides for construction of 50 MW wind power plant near Ereymentau city with the prospect of expanding up to 300 MW. The implementation of the Project will additionally produce 180 million kWh of electricity per year.

The project aims to use renewable energy sources to reduce the level of use of hydrocarbon energy carriers in production of electricity. Feasibility project of the Project was developed, design and estimate documentation is planned to be developed.

The project “Construction of 60 WPP in Shelek corridor with possible increase in capacity up to 300 MW”

The project involves the construction of 60 MW wind power plant in Shelek corridor of Almaty region, Enbekshikazakh district including a possible expansion of capacity up to 300 MW. The project implementation will allow producing additional 225.7 mln. kWh of electricity per year.

The project aims to use renewable energy sources to reduce the level of use of hydrocarbon energy resources in electricity production.

The project’s feasibility study was developed and design estimates are under development.

Gasification of Almaty CHP-1, 2, 3 of “APP” JSC

The main goal of implementing modernization projects of existing Almaty CHP plants is to reduce the negative impact on Almaty city and Almaty region environment from energy sources of “APP” JSC.

Regarding the transfer of Almaty CHP-2 to gas:

In 2018, a pre-feasibility study of the project was developed, wherein the construction of the new gas-fired power plant with the same capacity as the existing plant’s capacity was considered as the main option.

Expansion of Almaty CHP-1 with the installation of the new energy source based on gas turbine technologies:

An investment proposal for the project was developed.