Kazakh Authorities Ignore Political Implications of Strikes in Karazhanbas Oilfields

The popular British singer Sting disappointed thousands of his followers in Kazakhstan by suddenly canceling his concert scheduled for July 4 to celebrate the Day of Astana. The embarrassed promoters in Kazakhstan tried to attribute this cancelation to “technical reasons,” and finally had to reimburse tickets already sold for up to $690 each. Sting later disclosed that his decision to cancel his tour was prompted by Amnesty International being critical of Kazakh authorities’ handling of protest strikes in Karazhanbas oilfields on Buzachi peninsula in Mangistau region, western Kazakhstan (Vremya, July 5).

Karazhanbasmunai oil producing company, incorporating Tulpar Service, Argymak Trans Service, Ozenmunaygas is one of the largest oil producers in western Kazakhstan. Karazhanbas fields, discovered in 1974, are estimated to hold 238.5 million tons of hydrocarbons. In 2007, the Chinese CITIC Group Corporation acquired a 50 percent stake from the Kazakh national oil company KazMunaiGaz. Social unrest among oil workers in the volatile Mangistau region was brewing since March this year, when workers demanded double payment and to change the composition of the company council. On May 12, workers stripped the pliant trade union leader of his post and elected a replacement. Dozens of workers went on a hunger strike followed by mass protests that swept the region on May 17, demanding equal wages with foreign workers and an improvement of working conditions. In the first week of the strike, the managers of Karazhanbasmunai reported the loss of 240 million Tenge ($1.64 million) resulting from the standstill at the oil-wells (www.bnews.kz, May 25).

Karazhanbasmunai managers and the government completely ignored the workers’ demands as unsubstantiated, and responded with harsh measures. On the night of June 30, one of the organizers of the strike, Zhak Aminov, was arrested. Aktau city court sentenced him to two months in prison for allegedly instigating people to stage unsanctioned protest strikes. Natalia Sokolova, a legal advisor employed by the company, was also detained on similar charges. Following the detention of the leaders of the strikes, dozens of workers were detained by riot police and sacked. This only served to inflame the situation. By July 12, the number of protesters supported by residents of adjacent villages reached 15,000. Reportedly, in order to prevent workers from other oilfields from joining the strike, authorities cut off cell phone communication at Karazhanbas. The strikes, which continued in the region since mid-May, are unprecedented in their scale and intensity. In one case, a desperate group of workers doused themselves with gasoline and threatened to ignite it if any attempts were made to arrest them. They demanded that Zhak Aminov, Natalia Sokolova and other imprisoned workers be released and reinstated (Zhas Alash, July 12).

Oil workers in Mangistau region are highly paid. But they complain that their monthly wage barely reaches $700, while foreign workers hired by the company receive much higher wages for the same amount of work. Given the average 17.8 percent inflation rate in the region and galloping prices and utility costs, the existing wage level in the oil sector is just enough to provide basic subsistence to large families.  

On the surface, the protests appear purely economically driven, since the workers never expressed clearly outlined political demands. But the behind-the-scenes organizers are from various political camps with their specific motivations. The Federation of Trade Unions of Kazakhstan distanced itself from the strikes and declared them unlawful. Some sources in KazMunaiGaz, controlled by the president’s son-in-law Timur Kulibayev, spread rumors that brutal actions against the protesters were deliberately provoked by opponents of the governor of Mangistau region, Kyrymbek Kusherbayev, to oust him from his post. Communists did not miss the opportunity to advance their slogans of nationalizing all privatized enterprises in the oil sector and establishing workers’ control over energy resources. In Almaty, demonstrations by opposition forces in support of the oil workers in Mangistau region took an unexpected turn. There, dozens of protesters, on the approach to the presidential palace, unfurled banners against the schemes of government to transform the Customs Union with Russia and Belarus into a political union with Slavic nations, which would lead to a revival of Russian domination (Zhas Alash, July 14).  

According to reports released by the press service of Karazhanbasmunai, more than 250 workers were sacked. Within one month, the oil output at Ozenmunaygas alone was reduced by 600,000 tons. Far more serious are the likely political repercussions of the prolonged protests and heavy-handed handling of the situation in Mangistau region, which serves to strengthen the opposition. Given the growing public discontent provoked by economic discrimination of local workers in foreign-owned oil companies, attempts to politicize the protest actions could eventually fuel some form of instability in western Kazakhstan.