March 25, 2016 / 12:10 PM / 4 years ago

UPDATE 1-Kazakhstan replaces energy minister as oil output falls

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ALMATY, March 25 (Reuters) - Kazakhstan named Kanat Bozumbayev, a former head of the country’s power grid, as its new energy minister on Friday, as the second-largest oil producer in the former Soviet Union faces a drop in output following a slump in crude prices.

Bozumbayev, 47, replaces Vladimir Shkolnik, who oversaw a rapid expansion of oil output as energy minister from 1999-2006 and returned to the job in 2014.

The move follows parliamentary elections in which the ruling Nur Otan party retained its overwhelming majority. President Nursultan Nazarbayev, who leads Nur Otan, said last week he saw no need for a major government reshuffle.

Oil is the largest contributor to Kazakhstan’s exports.

Bozumbayev has worked as governor in two of Kazakhstan’s regions and before that led the Kazakhstan Electricity Grid Operating Company.

Nazarbayev’s office, which announced the reshuffle, did not say whether Shkolnik, 67, would get a new job in the cabinet or one of the state-owned companies.

Kazakhstan’s oil output is set to decline this year for a third year in a row due to spending cuts by some local producers in the face of lower crude prices as well as delays in launching commercial output at the huge Kashagan field.

Production at Kashagan was halted shortly after the initial launch in 2013 because the pipes connecting it to an onshore processing plant were leaking gas. It is set to restart in October this year.

Citing output cuts already made by Kazakhstan, Shkolnik this month balked at the idea of freezing production at January levels, as suggested by major producers who will gather in Qatar on April 17 to discuss such plans.

He said, however, that Kazakhstan would attend such talks if invited. (Reporting by Olzhas Auyezov; Editing by Polina Devitt and Mark Potter)

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