SOCAR, KazMunaiGaz set to create trans-Caspian oil export route
SOCAR, Azerbaijan`s state oil company, and Kazakh
giant KazMunaiGaz will set up a joint venture to build a system
transporting Caspian oil to Europe, KazMunaiGaz president Kairgeldy
Kabyldin has told reporters.
According to Kabyldin, the two companies intend to sign an agreement during Kazakh President Nursultan Nazarbayev`s visit to Baku in early October.
Under the project, the Central Asian state will deliver its oil to the Azerbaijani capital by tankers. The crude will then be transported to Turkey through the Baku-Tbilisi-Ceyhan (BTC) main export pipeline and continue to European markets. Twenty seven million tons of oil are to be exported through the trans-Caspian transport system at the initial stage.
The Kazakh state energy firm estimates that creating a system transporting hydrocarbons across the Caspian Sea could require up to $3 billion. Therefore, foreign investment will be drawn to financing the project.
The implementation of such projects would help to reduce reliance of the regional states on Russia, a major exporter of energy resources. Without the trans-Caspian system, Kazakhstan would have to use Russian territory to deliver its oil to the BTC, which does not suit the main importer, the European Union, that is seeking to reduce its dependence on Russian energy.
However, transporting Kazakh oil to Europe while bypassing Russia may prove a daunting task, analysts say. During the first stage of the project, the 730 km Eskene-Kuryk pipeline is to be built to deliver oil produced from the giant Kashagan and Tengiz fields to the Kuryk port on the Caspian shore. Only after that will it be possible to transport Kazakhstan`s crude to the Azerbaijani shores by tankers.
The trans-Caspian system is to be commissioned in 2012.
SOCAR and KazMunaiGaz are also considering opportunities for joint development of oil fields, Rovnag Abdullayev, the SOCAR President, said during a visit to Kazakhstan last week.
``The two companies are working to that end, but it`s too early to say anything specific,`` Abdullayev said, without elaborating on the country the joint projects would be implemented in and which oil fields were involved.
According to Kabyldin, the two companies intend to sign an agreement during Kazakh President Nursultan Nazarbayev`s visit to Baku in early October.
Under the project, the Central Asian state will deliver its oil to the Azerbaijani capital by tankers. The crude will then be transported to Turkey through the Baku-Tbilisi-Ceyhan (BTC) main export pipeline and continue to European markets. Twenty seven million tons of oil are to be exported through the trans-Caspian transport system at the initial stage.
The Kazakh state energy firm estimates that creating a system transporting hydrocarbons across the Caspian Sea could require up to $3 billion. Therefore, foreign investment will be drawn to financing the project.
The implementation of such projects would help to reduce reliance of the regional states on Russia, a major exporter of energy resources. Without the trans-Caspian system, Kazakhstan would have to use Russian territory to deliver its oil to the BTC, which does not suit the main importer, the European Union, that is seeking to reduce its dependence on Russian energy.
However, transporting Kazakh oil to Europe while bypassing Russia may prove a daunting task, analysts say. During the first stage of the project, the 730 km Eskene-Kuryk pipeline is to be built to deliver oil produced from the giant Kashagan and Tengiz fields to the Kuryk port on the Caspian shore. Only after that will it be possible to transport Kazakhstan`s crude to the Azerbaijani shores by tankers.
The trans-Caspian system is to be commissioned in 2012.
SOCAR and KazMunaiGaz are also considering opportunities for joint development of oil fields, Rovnag Abdullayev, the SOCAR President, said during a visit to Kazakhstan last week.
``The two companies are working to that end, but it`s too early to say anything specific,`` Abdullayev said, without elaborating on the country the joint projects would be implemented in and which oil fields were involved.
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