Author: Akhmad UMAROV, ICA certified in ManaginSanctions Risk, Sanctions Committee Member of the Compliance and Business Ethics Association, National Maritime Shipping Company Kazmortransflot LLP
On January 10, 2025, the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) imposed a new set of comprehensive sanctions aimed at restricting Russia’s access to international financial and commercial resources tied to its energy sector. These measures target not only Russian entities but also non-Russian affiliates, including several companies registered in Kazakhstan.
Key Provisions of the New Sanctions
1. Blocking Sanctions Against Major Russian Energy Companies
OFAC has added Public Joint Stock Company (“PJSC”) Gazprom Neft, PJSC Surgutneftegaz, and their subsidiaries (including foreign branches) to the Specially Designated Nationals and Blocked Persons (“SDN”) List. As a result, all property and interests in property of these entities that are or come within the United States (or the possession or control of U.S. persons) must be blocked, and U.S. persons are generally prohibited from engaging in any dealings with them.
2. Restrictions on Maritime Transport and Insurance Operations
OFAC designated PJSC Sovcomflot and its fleet of 69 vessels (including 54 oil tankers), as well as Russian insurance companies such as Ingosstrakh and AlfaStrakhovanie—both previously sanctioned by the United Kingdom. In addition, sanctions have been imposed on more than 180 vessels associated with what OFAC has termed Russia’s “shadow fleet.”
3. Prohibition on Oilfield Services
Effective February 27, 2025, U.S. persons are broadly prohibited from providing, directly or indirectly, any technical, consulting, or other services related to the exploration, production, processing, or transportation of oil in Russia. In total, OFAC has designated over 30 oilfield service providers and 15 foreign trading companies under these measures.
Impact on Kazakhstan
In assessing the effects of these sanctions on the Republic of Kazakhstan, the following points are particularly noteworthy:
1. Inclusion of Kazakhstan-Registered Companies in the Sanctions Lists
• Gazprom Neft Kazakhstan LLC – A subsidiary of the Russian company PJSC Gazprom Neft has been added to the SDN List.
• Umbra Navi Shipmanagement Corp – A company registered in Almaty, which OFAC has identified as linked to the Russian company PJSC Sovcomflot, is also designated.
2. Impact on Major Kazakhstani Projects
In addition to these designations, a significant consideration arises for Kazakhstani entities involved in the Caspian Pipeline Consortium (CPC) and Tengizchevroil projects. Since Kazakhstan’s primary oil export route traverses the Russian Federation, OFAC has issued General License No. 121, which temporarily authorizes the provision of oilfield services in connection with the CPC and Tengizchevroil projects until June 2025. Kazakhstani stakeholders are advised to plan their strategic and operational activities with the limited validity of this license in mind.
These new U.S. sanctions represent a substantial escalation of pressure on Russia’s energy sector and extend to foreign businesses affiliated with Russian entities, including those operating in Kazakhstan. Kazakhstani companies and financial institutions are advised to closely monitor developments in the sanctions regime, implement comprehensive compliance measures, and carefully evaluate any dealings with sanctioned parties. Such proactive steps will help mitigate the risks of secondary sanctions, financial losses, and reputational harm.