A case involving investments in the Sarybulak field in the East Kazakhstan region has sparked a major dispute between citizens of China and Kazakhstan.
Chinese investors, trusting a local company, worked for a year to explore for oil that does not exist in the East Kazakhstan region. However, the company that attracted the foreign investors had invalid licenses for drilling, and the permits had expired, reports Jurtmedia, citing the information and analytical portal Todayinfo.kz.
The main dispute over the Sarybulak field concerns the exploration and extraction of oil in the Zaysan district of East Kazakhstan. A local company, using the pretext of oil reserves in the east, held meetings with representatives of a Chinese giant company and convinced them. A mutual agreement was signed. The two sides met several times, and the Chinese investors brought equipment and drilled in the mountains of the east for a year. Initially, the Chinese investors transferred $4 million to the local company. Later, this amount increased.
According to the injured party, due to forged documents and the advertising of non-existent oil, Kazakhstan has lost $1 billion in investment.
Zhang Weidong, a citizen of the People's Republic of China and director of Asia Power Development (Hong Kong) Limited, received an invitation from the Kazakh side and came to Kazakhstan in 2023 intending to invest in oil exploration.
That same year, he reached an agreement with Tarbagatai Munai LLP and began oil exploration. However, according to Zhang Weidong, officials of Tarbagatai Munai LLP (TBM) misled him, convincing him that they had a valid exploration license, resulting in a loss of over $20 million and an inability to achieve justice.
According to him, an agreement on the implementation of a joint oil exploration project was signed between the two parties on March 9, 2023, with the Chinese side intending to make significant investments in the project. However, without carefully examining the documents, representatives of Asia Power Development (Hong Kong) Limited were caught off guard, unaware that the Kazakh side's time for this particular exploration was extremely limited.
The two parties agreed to work together and signed documents on March 9, 2023. However, the exploration license issued by the Ministry of Energy of the Republic of Kazakhstan to Tarbagatai Munai LLP expired on March 5, 2023. That is, the Chinese investors only later learned that the agreement was signed four days after the license had expired.
- According to the documents in our possession, Tarbagatai Munai LLP provided foreign investors with information that the right to subsoil use for the Sarybulak field, covering depths up to 4,200 meters and an area of 8,326.9 square kilometers, was valid until 2027. Based on this information, an operator agreement for joint exploration and development was concluded with the foreign investor on March 9, 2023.
However, according to the official response of the Ministry of Energy of the Republic of Kazakhstan dated March 16, 2026, the exploration period under Contract No. 84 ended on March 5, 2023. That is, at the time the operator agreement was concluded, the exploration period had already expired, - said Aidar Kumangazyuly, the legal representative of the injured party.
Furthermore, the new legal regime was only introduced on March 15, 2024. It does not allow for the continuation of exploration under the original license, as it was granted under completely different conditions. Specifically, the new right only applies to the extraction and preparation phase, covering an area of only 95.5 square kilometers and a permitted depth of only 2,546.4 meters. As a result, the investors say they were deceived and left empty-handed. Since nothing was found in the drilled well, they feel their trip to Kazakhstan was in vain.
According to the submitted documents, the total material damage from investments and costs incurred in the project exceeds $20 million, stated the lawyer for the injured party.
According to them, law enforcement agencies view this dispute as a civil law matter and have refused to give it a criminal law assessment.
Aidar Kurmangazyuly, the legal representative of Zhang Weidong in Kazakhstan, disagrees with this response and has filed a complaint with the Ministry of Energy of the Republic of Kazakhstan. However, the Ministry of Energy responded to the citizen's inquiry, stating that the operator agreements for Tarbagatai Munai LLP were formalized in accordance with the requirements of Kazakhstan's Code "On Subsoil and Subsoil Use."
According to the ministry, the company submitted the appropriate notification regarding the appointment of the operator and the necessary documents in the manner prescribed by law. Additionally, the department noted that relations between the operator and the subsoil user are regulated by the agreement concluded between them.
— Today, we are submitting an official complaint to the Prosecutor's Office of Almaty and the Police Department of Almaty regarding signs of a criminal offense. Our goal is a comprehensive, complete, and objective investigation of all circumstances.
This case is not just a dispute between individual companies. It concerns investments amounting to tens of millions of US dollars. Such situations can negatively impact Kazakhstan's investment attractiveness and international reputation.
Therefore, we request the competent state authorities to provide a comprehensive, objective, and legally compliant assessment of this case, - says Aidar Kurmangazyuly, the legal representative of the investor.
He believes that law enforcement agencies should thoroughly investigate this matter.
It is reported that applications have currently been sent to the Prosecutor's Office and the Police Department of Almaty. The parties stated that they are awaiting the results of the official bodies' investigations and will take the next legal steps based on those conclusions.
- We had plans to invest $1 billion in this sector in Kazakhstan. However, we were deceived by the local company. No oil was found; we conducted drilling operations in two locations for a year. We only realized we had been deceived when local authorities warned us to stop drilling. Representatives of other large companies have also heard about our experience, and they are refusing to invest in Kazakhstan. This action negatively impacts the country's reputation and is causing investors to leave. Our losses exceed $20 million. We are asking the Kazakh government to intervene and resolve this matter. Otherwise, we will have to raise this issue internationally and between the two states, - said Zhang Weidong, Director of Asia Power Development (Hong Kong) Limited in Kazakhstan.
A complaint will also be filed with law enforcement agencies regarding this disputed issue.
