Management and Business
e-ISSN 3041-2420 | UDC 33
|
EN
Submit an article →
← Vol. 4, No. 1, 2026

Research on the relationship between the level of innovative activity and the profitability of enterprises in the oil and gas sector of Kazakhstan

Olga Moskalenko

Abstract

The objective of this research was to assess how innovative activity influences the financial performance of enterprises in Kazakhstan’s oil and gas sector. The research was empirical and covered the period 2020-2024, using official financial statements of Joint Stock Company “KazMunayGas” and corporate documents on innovation programmes. The methodology combined statistical analysis of production volumes and financial dynamics with content analysis of strategic projects. Results showed that oil production fluctuated between 84-89.9 million tonnes, totalling 433.1 million tonnes, while gas production rose from 53-54 to 60.5 billion m³. In 2024, Tengiz, Karachaganak and Kashagan fields provided over 60% of national output (27.8, 12.4 and 17.9 million tonnes). Financial indicators reflected both innovation effects and market volatility: in 2020, net profit was only 172 billion tenge with revenue of 3,625 billion, while in 2022 profit peaked at 1,307 billion and revenue at 8,693 billion. By 2024, net profit reached 1,094 billion tenge, free cash flow 1,199 billion, and net debt fell to 1,163 billion – the lowest in five years. Investments in technological projects exceeded 250.8 billion tenge, with 98.2 billion for high-tech areas. More than 500 initiatives, including digital twins and artificial intelligence systems, were implemented in 2024. The results of this study can be used to develop an effective strategy for the innovative development of oil and gas enterprises in Kazakhstan in order to enhance their financial stability and competitiveness

Keywords:
strategies; revenue; investment; competitiveness; efficiency

References

  1. Abdou, H.A., Elamer, A.A., Abedin, M.Z., & Ibrahim, B.A. (2024). The impact of oil and global markets on Saudi stock market predictability: A machine learning approach. Energy Economics, 132, article number 107416. doi: 10.1016/j.eneco.2024.107416.
  2. Alsuhaibany, Y. (2025). Digital innovation and circular economy: A nexus for sustainable oil and gas sector transformation in Saudi Arabia. Sustainability, 17(3), article number 1325. doi: 10.3390/su17031325.
  3. Beisembayev, G., & Akhmetkyzy, A. (2025). Assessment of ESG efficiency of oil and gas sector in Kazakhstan. Eurasian Journal of Economic and Business Studies, 69(1), 18-31. doi: 10.47703/ejebs.v69i1.455.
  4. Beisembekova, S., Sikhimbayev, M., Sikhimbayeva, D., & Srailova, G. (2022). The innovative ways of development in the oil and gas industry of Kazakhstan. International Journal of Energy Economics and Policy, 12(1), 9-16. doi: 10.32479/ijeep.11505.
  5. Bibi, S. (2024). Oil revenues, FDI and balance of payment dynamics: The case of Kazakhstan between the supercycle commodity boom and financial subordination. Resources Policy, 90, article number 104789. doi: 10.1016/j.resourpol.2024.104789.
  6. Buana, S.G. (2025). The effect of CEO characteristics and profitability on tax aggressiveness in companies in the oil and gas sector in Indonesia for the 2021-2023 period. Asian Journal of Engineering Social and Health, 4(2), 263-277. doi: 10.46799/ajesh.v4i2.530.
  7. Decree of the President of the Republic of Kazakhstan No. 121 “Approval of the Strategy of the Republic of Kazakhstan on Achieving Carbon Neutrality by 2060”. (2023, February). Retrieved from https://unfccc.int/sites/default/files/resource/Carbon_Neutrlaity_Strategy_Kazakhstan_Eng_Oct2024.pdf.
  8. Dongo, D.F., & Relvas, S. (2025). Evaluating the role of the oil and gas industry in energy transition in oil-producing countries: A systematic literature review. Energy Research & Social Science, 120, article number 103905. doi: 10.1016/j.erss.2024.103905.
  9. Du, B., Juman, J., Makulova, A.T., Khamzayeva, A.V., & Zhai, X. (2024). Analysis of the competitiveness, complementarity, and trade combination of Kazakhstan and China in the oil and gas trade. Economies, 12(7), article number 182. doi: 10.3390/economies12070182.
  10. Grosu, V., Tiron-Tudor, A., Socoliuc, M., Ciubotariu, M.-S., Hlaciuc, E., Macovei, A.-G., Tulvinschi, M., Mihalciuc, C.-C., & Melega, A. (2023). Financial sustainability of oil and gas companies – basis for building resilience strategies. Frontiers in Environmental Science, 11, article number 1205522. doi: 10.3389/fenvs.2023.1205522
  11. Hajiyev, N., Abdullayeva, S., & Abdullayeva, E. (2024). Financial stability strategies for oil companies amidst high volatility in the global oil products market. Energy Strategy Reviews, 53, article number 101377. doi: 10.1016/j.esr.2024.101377.
  12. Halttunen, K., Slade, R., & Staffell, I. (2023). Diversify or die: Strategy options for oil majors in the sustainable energy transition. Energy Research & Social Science, 104, article number 103253. doi: 10.1016/j.erss.2023.103253.
  13. Herman, R., Nistor, C., & Jula, N.M. (2023). The influence of the increase in energy prices on the profitability of companies in the European Union. Sustainability, 15(21), article number 15404. doi: 10.3390/su152115404.
  14. Huda, M.N., & Sabur, M.A. (2025). Performance evaluation: The impact of the financial ratios on profitability performance of natural gas distribution companies in Bangladesh. International Journal of Research - GRANTHAALAYAH, 13(3), 115-133. doi: 10.29121/granthaalayah.v13.i3.2025.5950.
  15. Innovative technology development. (2024). Retrieved from https://ar2024.kmg.kz/en/strategic-report/operating-review/innovative-technology-development.
  16. Investment potential – oil production in Kazakhstan. (2025). Retrieved from https://s3-prod.exia.kz/articles/250120_Article_10_Investment_Potential_EN.pdf.
  17. Jaffe, A.M., Myslikova, Z., Qi, Q., Zhang, F., Oh, S., & Elass, J. (2023). Green innovation of state-owned oil and gas enterprises in BRICS countries: A review of performance. Climate Policy, 23(9), 1167-1181. doi: 10.1080/14693062.2022.2145261.
  18. JSC NC KazMunayGas announces 2023 FY financial results. (2024). Retrieved from https://www.kmg.kz/en/press-center/press-releases/finrez-2023/.
  19. JSC NC KazMunayGas announces 2024 FY financial results. (2025). Retrieved from https://www.kmg.kz/en/press-center/press-releases/finrez-2024/.
  20. Karachaganak Petroleum Operating. (n.d.). Retrieved from https://kpo-refinery.kz/.
  21. Kazakh Government approves 2024-2030 petrochemical industry development roadmap. (2024). Retrieved from https://qazinform.com/news/kazakhstan-prepares-2024-2030-petrochemical-industry-development-roadmap-5c4ddb.
  22. Kazakhstan Greenlights 2025-2040 oil processing strategy. (2025). Retrieved from https://caspianpost.com/kazakhstan/kazakhstan-greenlights-2025-2040-oil-processing-strategy.
  23. Kazakhstan Petrochemical Industries Inc. (n.d.). Retrieved from https://kpi.kz/kz/.
  24. Kazakhstan produced 85.7 Mt of oil and condensate in 2020. (2021). Retrieved from https://www.enerdata.net/publications/daily-energy-news/kazakhstan-produced-857-mt-oil-and-condensate-2020.html.
  25. Kazakhstan raises oil and gas condensate output by 7% in 2023. (2024). Retrieved from https://www.naturalgasworld.com/kazakhstan-hikes-oil-and-gas-condensate-output-7-in-2023-109079.
  26. Kazakhstan to invest $15 billion in oil and gas chemical industry development. (2025). Retrieved from https://timesca.com/kazakhstan-to-invest-15-billion-in-oil-and-gas-chemical-industry-development/.
  27. Kazakhstan’s Energy Ministry again lowers outlook for domestic oil output in 2024. (2024). Retrieved from https://interfax.com/newsroom/top-stories/108603/.
  28. Kazakhstan’s new gas & petrochemical projects to attract $25B investment. (2025). Retrieved from https://globalflowcontrol.com/newsroom/kazakhstans-new-gas-petrochemical-projects-to-attract-25b-investment/.
  29. KazMunayGas. (n.d.). Retrieved from https://www.kmg.kz/en/.
  30. Key 2021 financial results. (2022). Retrieved from https://ar2021.kmg.kz/en/strategic-report/financial-review/key-financial-results.
  31. KPO reports 2024 performance results. (2025). Retrieved from https://surl.li/zczuxb. 
  32. Kurmanov, N., Beisengaliyev, Y., Bayandin, M., Syzdykova, E., & Tolysbayeva, M. (2022). Innovative development of Kazakhstan’s raw material (oil and gas) regions: Multifactorial model for empirical analysis. International Journal of Energy Economics and Policy, 12(4), 131-140. doi: 10.32479/ijeep.13201.
  33. Maldynova, A., Bodaukhan, G., Aitkhojayeva, G., Ilyas, A., & Murzabekova, B. (2023). Innovative potential of the oil and gas industry of Kazakhstan. Eurasian Journal of Economic and Business Studies, 67(2), 33-44. doi: 10.47703/ejebs.v2i67.253.
  34. Mamyshev, Z. (2025). Oil companies in Kazakhstan could face a new tax burden. Retrieved from https://kz.kursiv.media/en/2025-05-06/engk-yeri-oil-companies-in-kazakhstan-could-face-new-tax-burden/.
  35. Mashaev, A. (2025). Tengiz, Kashagan and beyond: Ranking Kazakhstan’s largest oil producers. Retrieved from https://kz.kursiv.media/en/2025-06-18/engk-yeri-tengiz-kashagan-and-beyond-ranking-kazakhstans-largest-oil-producers/.
  36. Moralista, R., & Martir, E.M. (2023). Oil price volatility and business profitability: Evidence from the local market. Journal of Advanced Zoology, 44(S-5), 1602-1606. doi: 10.17762/jaz.v44iS-5.1398.
  37. OECD. (n.d.). Retrieved from https://www.oecd.org/en.html.
  38. Operator to invest over $1.7 bln in growth project at Kazakhstan’s Karachaganak field by 2027. (2023). Retrieved from https://interfax.com/newsroom/top-stories/88578/.
  39. Perrons, R.K., Burgers, J.H., & Newton, C. (2024). Individual-level innovation in the upstream oil & gas industry: Insights from a global survey. Geoenergy Science and Engineering, 235, article number 212692. doi: 10.1016/j.geoen.2024.212692.
  40. Saktaganova, G., Karipova, A., Mukhiyayeva, D., Zhanseitova, G. , & Saktaganova, I. (2025). Digital transformation in the transport and logistics sector of Kazakhstan: Challenges and opportunities for global integration. Scientific Bulletin of Mukachevo State University. Series “Economics”, 12(2), 163-176. doi: 10.52566/msu-econ2.2025.163.
  41. Shalbolova, U., Salykova, L., Bissenov, K., & Makhanov, S. (2024). Investments in the processing sector of the oil and gas complex of Republic of Kazakhstan. Gospodarka Surowcami Mineralnymi – Mineral Resources Management, 40(3), 135-152. doi: 10.24425/gsm.2024.151532.
  42. Sitmagambetov, N. (2025). Hybrid professionals are key to future of Kazakhstan’s oil and gas sector. Retrieved from https://astanatimes.com/2025/05/hybrid-professionals-are-key-to-future-of-kazakhstans-oil-and-gas-sector/.
  43. Sletten, S., Jonasmo, K.W., & Solheim, M.C.W. (2023). Changing industrial trajectories through business model innovation: A case study of the oil and gas industry in Norway. European Planning Studies, 31(7), 1555-1574. doi: 10.1080/09654313.2023.2185503.
  44. Tengiz Effect – 2033 and beyond. (2024). Retrieved from https://s3-prod.exia.kz/articles/240913_Article%203_Tengiz%20Effect%20%E2%80%93%202033%20and%20beyond.pdf.
  45. Tengizchevroil Fact Sheet. (2024). Retrieved from https://tengizchevroil.com/docs/default-source/default-document-library/facts-and-figures/2024/tco-fact-sheet-4q-2024_final_e.pdf?sfvrsn=9bcecc5c_2.
  46. Tengizchevroil. (n.d.a). Retrieved from https://www.tengizchevroil.com/home.
  47. Tengizchevroil. (n.d.b). Projects. Retrieved from https://tengizchevroil.com/projects#.
  48. Vuong, G.T.H., Nguyen, M.H., & Hoang, K. (2024). Oil price uncertainty, oil pricing reform, and corporate profitability: The case of China. PLOS ONE, 19(2), article number e0297554. doi: 10.1371/journal.pone.0297554.
  49. Wang, Y. (2023). Investment analysis of listed companies in the oil & gas industry. BCP Business & Management, 37, 266-272. doi: 10.54691/bcpbm.v37i.3575.
  50. Zengin, B., & Kurt, G. (2024). The relationship between innovation activities and profitability of BIST manufacturing companies. Journal of the Faculty of Economics and Administrative Sciences of Kafkas University, 15(29), 188-213. doi: 10.36543/kauiibfd.2024.008.
  51. Zhumadilla, S., Sikhimbayev, M.R., Kadyrova, G.A., & Sikhimbaeva, D.R. (2024). Oil and gas industry of Kazakhstan: Ways to develop innovative processes. Bulletin of the Kazakh University of Economics, Finance and International Trade, 3(56), 19-26. doi: 10.52260/2304-7216.2024.3(56).2.

Suggested citation

Moskalenko, O. (2026). Research on the relationship between the level of innovative activity and the profitability of enterprises in the oil and gas sector of Kazakhstan. Management and Business, 4(1), 59-69. https://doi.org/10.59214/mb/1.2026.59