Kazakhstan is the second largest country of the CIS after Russia and is endowed with numerous economical exploitable minerals and metals. The mining industry accounts for approximately 27% of the Kazakhstan’s GDP, with 50% of the country’s GDP coming from oil and gas products. Most of Kazakhstan’s’ foreign investment (40%) has been focussed on the oil and gas sector.
Kazakhstan underwent major developments in its mining and metallurgical sectors during the Soviet Era. However, since dissolution of the Soviet Union, the industry has suffered major production drops as well as being faced with mineral reserve depletion. This scenario is common throughout the CIS, and attempts are being made to actively explore and develop new mineral deposits by promoting foreign investment.
Privatization of several state assets has begun and Kazakhstan has several foreign joint venture partners in several of its mining concerns. Soviet era policies had resulted in several high grade deposits being mined out, with the current reserve base of several minerals being of a lower grade.
The country suffered from lack of funds to upgrade existing facilities, infrastructure and carry out continuing exploration to identify new ore reserves, however, the situation has been improving with the country's overall mineral production increased by 8.8% in 2003, with higher output of manganese and chromium ores (rising by 28.7% and 23.6%, respec- tively), natural gas (22.1%), iron ore pellets (21.1%), coal (14.9%) and crude oil (7.7%).
Several of Kazakhstan’s largest metallurgical industries were managed by a partnership between British based Trans World Group (TWG) and the Kazakhstan Mineral Resources Corporation (KMRC). Industries included the Sokolov-Sarbai Mining Production Association (SSGPO), Kazakhstan's biggest iron ore producer, Aluminum of Kazakhstan, the company that controls Kazakhstan’s alumina and bauxite industry and Kazkhrom, the national chrome corporation, in 1996-1997. However, in 1999, the Kazakhstan Supreme Court ruled that TWG had inflicted damage to Kazakhstan’s economy through poor deals and contracts with the country’s metals industry. This resulted in a lawsuit between TWG and KMRC over ownership of assets in Kazakhstan’s metals industry. Apparently the issues have been resolved and all charges dropped.
