Rich in oil and gas reserves, the land-locked Central Asian nation of Kazakhstan has always looked for opportunities to enter the global markets. For a country whose budget largely depends on the profits from oil sales, it is vital for the government of Kazakhstan to ship as much oil abroad to boost the economy.
The main route for the transportation of Kazakh oil was and still remains the Caspian Pipeline Consortium (CPC). For many years, however, due to its low throughput, Kazakh oil companies have had a hard time getting their growing volumes through the pipeline.
The idea of nearly doubling the annual capacity of the CPC from 37 million tonnes of oil to 67 million tonnes would significantly bolster Kazakhstan’s annual revenue. The CPC expansion project, which was launched in 2011, was nearly completed last year and immediately had a positive impact on the volume of oil being transported from Kazakhstan, CPC General Director Nikolai Gorban said at a press conference in Astana on April 4.
“2017 was the most successful in the history of the CPC. As the main production indicator is the volume of oil pumping, it grew by almost a quarter compared to 2016,” Gorban said, opening a meeting with journalists.
At the end of 2017, the CPC’s capacity expansion project reached 67 million tonnes per year. Everything now depends on the oil producers themselves. Currently, the CPC has a surplus of capacity as a result of the increased volume from last year. About 55.1 million tonnes of crude oil were transported to world markets by the CPC – 10.8 million more more tonnes than in 2016. Nearly 50 million tonnes of which was produced by the largest oil companies operating at fields located in western Kazakhstan.
“The main volumes of Kazakh oil were transported from: Tengiz fields (28.8 million tonnes); Karachaganak (10.6 million tonnes); Kashagan (7.4 million tonnes),” said Gorban.
The CPC intends to transport 67 million tonnes of oil in 2018, of which 60 million will be of Kazakh origin. The remaining seven million tonnes will be supplied by Russian producers. As a result, he Consortium plans to increase the volume of transportation of crude oil this year by another 12 million tonnes.
The contribution of Kashagan, with which the Kazakh authorities have great hopes, should amount to 13 million tonnes of oil, almost double the figure of last year’s 7.4 million tonnes. About 12 million tonnes are expected from Karachaganak and 28 million tonnes from the Tengiz. The remaining seven million tonnes should be provided by other deposits.
“For April, we plan to pump 5.1 million tonnes of oil from Kazakhstan. That plan remains in place. None of the transporters have announced any significant reductions, although we know that some decline in production at Kashagan occurred recently, but as far as we know the developers of Kashagan said they should correct this situation within a month,” Gorban said.