BP is banking on Central Asia's gas reserves

In western Kazakhstan and Uzbekistan, a region that has received little attention until now is emerging as the focus of new energy hopes. The Ustyurt Plateau, a vast expanse of land straddling the two countries, could prove to be one of the most exciting exploration areas in Central Asia. And BP is increasingly positioning itself as a driving force in this development.

Several new agreements and political signals suggest that major natural gas and oil reserves could be tapped in the region. This not only increases the strategic importance of the plateau itself but also gives new momentum to the idea of a Trans-Caspian gas corridor, which has been under discussion for years.

BP is currently visibly expanding its presence in the region. In early April, a subsidiary of the British group signed an exploration contract with the Kazakh state-owned company KazMunayGaz for a promising block on the Ustyurt Plateau. For Astana, this is more than just routine business: the agreement is intended to mark the start of deeper cooperation on new production projects.

At the same time, indications of a new energy policy axis are also growing in Uzbekistan. There, BP is holding talks on a potential stake in projects together with Uzbekneftegaz and the Azerbaijani company SOCAR. Uzbek government officials are already openly discussing plans to specifically direct foreign investment toward the Ustyurt region.

In the background is a production-sharing agreement that Uzbekistan had already concluded with SOCAR last year. It covers the exploration of a large area and the joint development of economically viable discoveries. When President Shavkat Mirziyoyev spoke shortly thereafter of a “very large natural gas field” in Ustyurt, it initially seemed like political hyperbole. However, the ongoing efforts to bring BP into the project lend new weight to this announcement.

North of the plateau, too, there are increasing signs of a major energy-geological realignment. In Kazakhstan, a large onshore oil and gas deposit was reported in the Shyljoi district in early April. Kazakh media are already describing the discovery as a “second Kashagan”—with the crucial difference that it is onshore and would therefore be significantly cheaper to develop than the technically challenging offshore field in the Caspian Sea.

This point is of particular significance for Kazakhstan. While the existing Kashagan model is heavily influenced by earlier production-sharing agreements that gave the state only limited access to export revenues, Astana is likely to push for significantly more favorable terms in new projects. New discoveries would thus be not only a geological but also a fiscal gain.

However, the economic potential extends beyond individual production fields. With every new exploration project, the appeal of a Trans-Caspian export corridor—which could transport gas from Kazakhstan and Turkmenistan to Europe via Azerbaijan—grows. Such a corridor would connect to the Southern Gas Corridor and link Central Asia more closely to European energy markets.

This prospect also appears to be playing a role within BP. Company representatives based in Azerbaijan are already speaking of a possible new energy corridor, for which experience from existing projects in the South Caucasus could be leveraged. This suggests that BP is not just focusing on individual fields, but is envisioning the region as an integrated new energy cluster.

This opens a new chapter for Central Asia. Ustyurt could evolve from a remote border region into a geostrategic energy hub—provided that geologists’ hopes are indeed confirmed in economically viable quantities.