PetroKazakhstan carries out all its exploration and production activities in the area of 80,000 square kilometers in South-Turgai basin in the south of Central Kazakhstan. Generally, the productive zones of company’s fields are located at a relatively shallow depth, i.e. from 760 to 1.830 meters, though some of the recently drilled wells reached the productive zones to a depth of 2.300 to 3.550 meters. The oil-bearing strata of PetroKazakhstan’s fields have a high porosity and high permeability with light sweet crude having a density of 37° to 44° on API scale, and sulfur content of less than 0.4%. These favorable characteristics allow PetroKazakhstan to develop its fields, produce and process its crude at low costs.

PetroKazakhstan Kumkol Resources (PKKR) carries out a focused search and evaluation of porosity traps which have not been surveyed earlier in the South-Turgai basin. Reserves increment is one of the priorities and the basis for long term and stable Company’s development. Active geologic-exploration works are performed on existing assets for the PKKR reserves increment. Thus, in 2010 the Company drilled 14 exploratory wells, conducted 2D seismics with the area of 800 linear km and 3D with the area of 150 km2 on the license areas 1057 and 1928 accordingly. One of the most successful achievements in 2010 was discovery of the Western Karabulak oilfield. Major oil reserves increment is expected from this oilfield, where the approved reserves are 1 090 thousand tons. It is also worth to mention discovery of Western Tuzkol and Taskuduk oilfields, as according to the preliminary evaluation, recoverable oil reserves there amount to 1 500 thousand tons. The Company also discovered the new deposits on the developed Kumkol oilfield, where oil and gas bearing capacity was identified through the drilling in the basement deposits.

The successful complex of geologic-exploration works and drilling enabled to increase appraisal indexes and to reach the production volume, targeted by the Company in 2010. The Drilling results have not only increased the PKKR reserves, but also set the new goals on the search of most efficient exploration directions. In 2011, the Company is planning to drill 29 exploratory wells and perform 3D seismic search in amount of 450 sq.km. It is expected that the works on Western Karabulak pilot production will be one of the main exploration areas in 2011.