The second reason is the lack of confidence in local suppliers on the part of oil and gas operators. It is not uncommon for local suppliers of goods to be late in delivering equipment and materials. Any delay affects the schedule of work, and can lead to a halt in the production process, which in turn entails costs for the company as a whole. And one day of downtime for large operators costs 15 million US dollars. So subsoil users simply do not want to risk and lose money.
Of course, not all Kazakhstani manufacturers work poorly and of poor quality. But often they just don't know where their goods are needed. And this is the third reason - local suppliers do not have access to information on purchases of large subsoil users.
Kazakhstan has the National Agency for the Development of Local Content (NADLoC) of the Ministry of Industry and Infrastructure Development, which has been determined by the National Development Institute for the Development of Local Content in accordance with the decree of the Government of the Republic of Kazakhstan since 2012. NADLoC publishes information on procurement plans and tenders of subsoil users on the Internet portals "Register of goods, works and services during subsoil use operations and their manufacturers", "Kazakhstani content". However, there is no information on purchases of the largest oil and gas projects. Subsoil users themselves contact potential suppliers to conduct tenders.
The Information and Analytical Center for Oil and Gas (IACOG) also functions in the country, which monitors the oil and gas industry in Kazakhstan. The Center analyzes the dynamics of the fulfillment of contractual obligations of subsoil users of the energy sector in terms of local content in the procurement of goods, works and services, personnel, as well as in terms of the amount of expenses allocated for training, advanced training and retraining of citizens of Kazakhstan. However, local content development statistics are not publicly available, but a commercial product of IACNG. As a result, all information on the local content and procurement of large subsoil users in the country is closed.
Lack of transparency of information, lack of a single coordination center and general strategy for the development of local content is the fourth reason. Today, functions of local content are "divided" into various departments of government agencies, and the state policy on import substitution is not being fully implemented as evidenced by low indicators for the development of local content in goods.