JOINT ORDER OF THE MINISTER OF ENERGY OF THE REPUBLIC OF KAZAKHSTAN AND I.O. OF THE MINISTER OF NATIONAL ECONOMY OF THE REPUBLIC OF KAZAKHSTAN

of November 23, 2018 No. 453, on November 23, 2018 No. 77

About approval of criteria for evaluation of risk degree and checking sheets when carrying out transactions on subsurface use in the field of hydrocarbons

According to Item 5 of Article 141, Item 1 of article 143 of the Entrepreneurial code of the Republic of Kazakhstan we ORDER:

1. Approve:

1) criteria for evaluation of risk degree when carrying out transactions on subsurface use in the field of hydrocarbons according to appendix 1 to this joint order;

2) checking leaf when carrying out transactions on subsurface use in the field of hydrocarbons on the land concerning the physical persons or legal entities having rights of carrying out transactions on subsurface use on investigation of hydrocarbons according to appendix 2 to this joint order;

3) checking leaf when carrying out transactions on subsurface use in the field of hydrocarbons on the land concerning the physical persons or legal entities having rights of carrying out transactions on subsurface use on hydrocarbon production according to appendix 3 to this joint order;

4) checking leaf when carrying out transactions on subsurface use in the field of hydrocarbons at the sea concerning the physical persons or legal entities having rights of carrying out transactions on subsurface use on investigation of hydrocarbons according to appendix 4 to this joint order;

5) checking leaf when carrying out transactions on subsurface use in the field of hydrocarbons at the sea concerning the physical persons or legal entities having rights of carrying out transactions on subsurface use on hydrocarbon production according to appendix 5 to this joint order;

6) checking leaf when carrying out transactions on subsurface use in the field of hydrocarbons concerning physical persons or legal entities which right of carrying out transactions on subsurface use is stopped according to appendix 6 to this joint order;

7) checking leaf when carrying out transactions on subsurface use in the field of hydrocarbons concerning the physical persons or legal entities having permission to creation and placement of sea objects according to appendix 7 to this joint order.

2. Declare invalid the joint order of the acting minister of power industry of the Republic of Kazakhstan of December 14, 2015 No. 718 and the Minister of national economy of the Republic of Kazakhstan of December 28, 2015 No. 800 "About approval of criteria for evaluation of risk degree and checking leaf in the field of carrying out oil operations" (it is registered in the Register of state registration of regulatory legal acts for No. 12673, it is published on January 27, 2016 in information system of law of Ad_let).

3. In spheres of hydrocarbons and subsurface use of the Department of Energy of the Republic of Kazakhstan in the procedure established by the legislation of the Republic of Kazakhstan to provide to department of the state control:

1) state registration of this joint order in the Ministry of Justice of the Republic of Kazakhstan;

2) within ten calendar days from the date of state registration of this joint order the direction it in the Kazakh and Russian languages in the Republican state company on the right of economic maintaining "The republican center of legal information of the Ministry of Justice of the Republic of Kazakhstan" for official publication and inclusion in Reference control bank of regulatory legal acts of the Republic of Kazakhstan;

3) placement of this joint order on Internet resource of the Department of Energy of the Republic of Kazakhstan;

4) within ten working days after state registration of this joint order in the Ministry of Justice of the Republic of Kazakhstan submission to Department of legal service of the Department of Energy of the Republic of Kazakhstan of data on execution of the actions provided by subitems 1), 2) and 3) of this Item.

4. To impose control of execution of this joint order on the supervising vice-Minister of Energy of the Republic of Kazakhstan.

5. This joint order becomes effective after ten calendar days after day of its first official publication.

Minister of Energy of the Republic of Kazakhstan

K. Bozumbayev

Acting minister of national economy of the Republic of Kazakhstan

R. Dalenov

It is approved Committee on legal statistics and special accounting of the Prosecutor General's Office of the Republic of Kazakhstan

Appendix 1

to the joint Order of the Minister of Energy of the Republic of Kazakhstan and the acting minister of national economy of the Republic of Kazakhstan of November 23, 2018 No. 453, on November 23, 2018 No. 77

Criteria for evaluation of risk degree when carrying out transactions on subsurface use in the field of hydrocarbons

Chapter 1. General provisions

1. These Criteria for evaluation of risk degree when carrying out transactions on subsurface use in the field of hydrocarbons (further – Criteria) are developed according to Item 5 of article 141 of the Entrepreneurial code of the Republic of Kazakhstan (further – the Entrepreneurial code), the Code of the Republic of Kazakhstan "About subsoil and subsurface use" (further – the Code) and Rules of forming by the regulatory state agencies of system of assessment and risk management approved by the order of the acting minister of national economy of the Republic of Kazakhstan of June 22, 2022 No. 48 (it is registered in the Register of state registration of regulatory legal acts for No. 28577) for the purpose of reference of subjects (objects) of control in the field of control when carrying out transactions on subsurface use in the field of hydrocarbons on risk degrees.

1) the subject of control – the physical persons or legal entities having rights of carrying out transactions on subsurface use in the field of hydrocarbons and also physical persons or legal entities the right of carrying out transactions on subsurface use of which is stopped;

2) point – quantitative measure of calculation of risk;

3) insignificant violations – the violations connected with:

non-compliance with the requirement for the direction annually in authorized body in the field of hydrocarbons of reports on accomplishment of development programs of conversion of sour gas;

non-compliance with the requirement for independent testing of each productive layer in case of approbation of layer and testing of wells (for the term established by the project document, but no more than 90 (ninety) days for each object of testing with carrying out complex of trade and geological and hydrodynamic researches);

absence in technological operating mode of wells of technological regulation of selection of liquid – for each production well and amount of the forced forcing-out agent (susceptibility) – for each delivery well;

lack of technological operating modes of the production wells which are constituted monthly or once in quarter depending on stability of conditions of development of object. Along with technological operating modes of production wells the plan of geological and technical actions for ensuring regulations of selection of liquid from wells and operational object in general is constituted and affirms;

non-compliance with requirements to forming of tender committee according to procedure for acquisition by subsoil users and their contractors of the goods, works and services used when carrying out transactions on investigation or hydrocarbon production;

non-compliance with requirements to placement of the announcement of holding open tender and the tender documentation in the register (system) according to procedure for acquisition by subsoil users and their contractors of the goods, works and services used when carrying out transactions on investigation or hydrocarbon production;

4) normalization of data – the statistical procedure providing reduction of the values measured in different scales to conditionally general scale;

5) considerable violations – the violations connected with non-compliance with binding regulation of the Code;

6) gross violations – the violations connected with non-compliance with the prohibiting Code regulation;

7) risk – probability of damnification as a result of activities of the subject of control of life or to health of the person, the environment, legitimate interests of physical persons and legal entities, valuable interests of the state taking into account severity of its effects;

8) criteria for evaluation of risk degree – set of the quantitative and qualitative indexes connected with the direct activities of the subject of control, features of industry development and factors influencing this development, allowing to carry subjects (objects) of control to different risk degrees;

9) objective criteria for evaluation of risk degree (further – objective criteria) – the criteria for evaluation of risk degree used for selection of subjects (objects) of control depending on risk degree in certain field of activity and which are not depending directly on separate subject (object) of control;

10) subjective criteria for evaluation of risk degree (further – subjective criteria) – the criteria for evaluation of risk degree used for selection of subjects (objects) of control depending on results of activities of specific subject (object) of control;

11) system of assessment and risk management – process of acceptance of the management decisions directed to decrease in probability of approach of adverse factors by distribution of subjects (objects) of control on risk degrees for the subsequent implementation of preventive control with visit of subject (object) of control for the purpose of minimum possible extent of restriction of freedom of enterprise, providing at the same time admissible risk level in the corresponding fields of activity, and also directed to change of risk level for specific subject (object) of control and (or) release of such subject (object) of control from preventive control with visit of subject (object) of control.

3. For risk management objectives when implementing preventive control with visit of subject (object) of control subjects (objects) of control belong to one of the following risk degrees (further – risk degrees):

1) high risk;

2) average risk;

3) low risk.

4. Criteria for evaluation of risk degree for carrying out preventive control of subjects (objects) control are created by means of determination of objective and subjective criteria.

Chapter 2. Objective criteria

5. Determination of objective criteria is performed by means of risk identification.

6. Risk identification is performed taking into account one of the following criteria:

1) level of danger (complexity) of object;

2) scales of weight of possible negative effects, harm on the regulated sphere (area);

3) possibilities of approach of adverse incident for life or health of the person, environment, legitimate interests of physical persons and legal entities, states.

7. The subjects of control which are the physical persons or legal entities having rights of carrying out transactions on subsurface use on hydrocarbon production (having the contract for subsurface use) treat high risk.

The subjects of control which are the physical persons or legal entities having rights of carrying out transactions on subsurface use on investigation of hydrocarbons (having the contract for subsurface use) treat average risk degree.

The subjects of control which are physical persons or legal entities which right of carrying out transactions on subsurface use in the field of hydrocarbons is stopped treat low risk degree.

8. Subjective criteria for the purpose of carrying out preventive control with visit of subject (object) of control are applied to subjects (objects) of control carried to high and average risk degree.

Chapter 3. Subjective criteria

9. Determination of subjective criteria is performed using the following stages:

1) forming of the database and information collection;

2) information analysis and risk assessment;

10. Forming of the database and information collection are necessary for identification of subjects (objects) of control violating the law of the Republic of Kazakhstan.

For risk degree assessment for carrying out preventive control with visit of subjects (objects) of control the following sources of information are used:

1) results of monitoring of the reporting and the data represented by the subject of control to authorized body in the field of hydrocarbons;

2) results of the previous checks and preventive control with visit of subjects (objects) of control. At the same time, severity of violations (rough, considerable, insignificant) is established in case of non-compliance with the requirements of the legislation reflected in checking sheets.

For risk degree assessment for conducting check on compliance to allowing requirements information source - results of the previous checks is used. At the same time, severity of violations (rough, considerable, insignificant) is established in case of non-compliance with the requirements of the legislation reflected in checking sheets.

11. Measure calculation of risk degree by subjective criteria (R) is perfromed in the automated mode by summing of exponent of risk on violations by results of the previous checks (SP) and exponent of risk by subjective criteria (SC), with the subsequent normalization of values from 0 to 100 points this in the range.

Rprom = SP + SC, where

Rprom – intermediate exponent of risk by subjective criteria,

SP – risk exponent on violations,

SC – risk exponent by subjective criteria.

Calculation is made on each subject (object) of control of homogeneous group of subjects (objects) of control of each sphere of the state control. At the same time the list of the estimated subjects (objects) of control of the subjects (objects) of control of one sphere of the state control carried to homogeneous group, forms sample (selection) for the subsequent normalization of data.

According to the data obtained by results of the previous checks the risk exponent on violations estimated in points from 0 to 100 is created.

In case of identification of one gross violation on any of the sources of information specified in Item of 10 presents criteria, the subject of control the exponent of risk of 100 points is equated and concerning it preventive control with visit of subject (object) of control is carried out.

In case of not identification of gross violations the risk exponent on violations is calculated total indicator on violations of considerable and insignificant degree.

In case of measure definition of considerable violations 0,7 coefficient is applied.

This indicator is calculated by the following formula:

SRZ = (SP2 x 100/SP1) x 0,7, where:

SRZ – indicator of considerable violations;

SP1 – the required number of considerable violations;

SP2 – the number of the revealed considerable violations;

In case of measure definition of insignificant violations 0,3 coefficient is applied.

This indicator is calculated by the following formula:

SRN = (SP2 x 100/SP1) x 0,3, where:

SRN – indicator of insignificant violations;

SP1 – the required number of insignificant violations;

SP2 – the number of the revealed insignificant violations;

The risk exponent on violations (SP) is calculated on scale from 0 to 100 points and is determined by summing of indicators of considerable and insignificant violations by the following formula:

SP = SRZ + SRN, where:

SP – risk exponent on violations;

SRZ – indicator of considerable violations;

SRN – indicator of insignificant violations.

The received value of general indicator is the basis of reference of the subject of entrepreneurship to one of the following risk degrees:

1) to high risk – in case of exponent of risk from 71 to 100 inclusive and concerning it preventive control with visit of subject (object) of control is carried out;

2) to average risk degree – in case of exponent of risk from 31 to 70 inclusive and concerning it preventive control with visit of subject (object) of control is carried out;

3) to low risk degree – in case of exponent of risk from 0 to 30 inclusive and concerning it preventive control with visit of subject (object) of control is not carried out.

Proceeding from priority of the applied sources of information and the importance of indicators of subjective criteria, according to risk exponent procedure of payments by subjective criteria, the risk exponent by subjective criteria on scale from 0 to 100 points is calculated.

Measure calculation of risk degree by subjective criteria is made on scale from 0 to 100 points and performed on the following formula:

 

xi – indicator of subjective criterion,

wi – specific weight of indicator of subjective criterion,

n – quantity of indicators.

The received risk degree measure value by subjective criteria joins in measure calculation of risk degree by subjective criteria.

The values calculated by subjects (objects) by indicator are normalized in the range from 0 to 100 points. Normalization of data is performed on each sample (selection) with use of the following formula:

 

R – risk exponent (final) by subjective criteria of separate subject (object) of control,

Rmax – the greatest possible value on risk degree scale by subjective criteria on subjects (objects) entering one sample (selection) (the upper bound of scale)

Rmin – minimum possible value on risk degree scale by subjective criteria on subjects (objects) entering one sample (selection) (the lower bound of scale)

Rprom – intermediate exponent of risk by subjective criteria.

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