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The risk is in the relationship (not the country): Political risk management in the uranium industry in Kazakhstan

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  • Conway, J. Edward

Abstract

How do we account for multinational energy companies that are able to operate in “risky” political environments? While traditional risk indices may tell us why a country is considered a difficult operating environment, they tell us very little about why some multinationals are neverthelessly able to operate successfully in such countries over long periods of time. In fact, risk indices by their very nature make “success” almost impossible to capture due to their sole focus on country behavior. In reality, when a multinational energy company enters into a given country, the firm establishes relationships with a series of stakeholders, not a single “host country” entity; further, the behaviors of those stakeholders (good or bad) do not exist in a vacuum, but rather are largely influenced by the multinational's own behavior. In other words, the risk is in the relationship between the firm and the country's stakeholders. This article argues that success is therefore a function of the firm's ability to manage relationships among a variety of stakeholders within a given country. A case study of Cameco, a Canadian-based uranium mining multinational which has been operating in the politically “risky” country of Kazakhstan for two decades, bears this out.

Suggested Citation

  • Conway, J. Edward, 2013. "The risk is in the relationship (not the country): Political risk management in the uranium industry in Kazakhstan," Energy Policy, Elsevier, vol. 56(C), pages 201-209.
  • Handle: RePEc:eee:enepol:v:56:y:2013:i:c:p:201-209
    DOI: 10.1016/j.enpol.2012.12.043
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    References listed on IDEAS

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    Cited by:

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    2. Ahmad, Salman & Nadeem, Abid & Akhanova, Gulzhanat & Houghton, Tom & Muhammad-Sukki, Firdaus, 2017. "Multi-criteria evaluation of renewable and nuclear resources for electricity generation in Kazakhstan," Energy, Elsevier, vol. 141(C), pages 1880-1891.
    3. Gong, Binlei, 2018. "Different behaviors in natural gas production between national and private oil companies: Economics-driven or environment-driven?," Energy Policy, Elsevier, vol. 114(C), pages 145-152.
    4. Abdildin, Yerkin G. & Abbas, Ali E., 2016. "Analysis of decision alternatives of the deep borehole filter restoration problem," Energy, Elsevier, vol. 114(C), pages 1306-1321.

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