Oil production at Kashagan field might be postponed again
By Aynur Jafarova
Oil production at the giant Kashagan field located in the Kazakh sector of the Caspian Sea might be postponed from June to early September, Kazakh Minister of Economy and Budget Planning Yerbolat Dossayev said at the governmental meeting on Tuesday.
He said this postponement would have no effect on budget revenues, adding that the postponement is related with the testing of the equipment.
In turn, Kazakh Oil and gas Minister Sauat Mynbayev said the oil production at the Kashagan field will start by September 2013 at latest.
Mynbayev said that if the commercial production will start beyond September, "in line with the agreement of 2008, the consortium partner companies would bear all the costs which will not be compensated by the country."
Earlier Managing Director of Agip KCO Umberto Carrara said that production of first oil at the Kashagan offshore field in Kazakhstan has been postponed from March till June.
According to Senior Scientific Associate of the Economics Institute under Kazakh Education and Science Ministry Oleg Yegorov, oil production in the Kashagan field was scheduled to be launched in March. However, has been delayed four times and there is no assurance that Kashagan will be launched in summer or fall.
He said that increase of oil production in Kazakhstan completely depends on the start of the Kashagan production as it is currently the only oil field capable of significantly boosting oil production in the country.
Kashagan is one of the largest fields discovered in the past 40 years. Recoverable oil reserves of Kashagan are estimated at 11 billion barrels, whereas total geological raw material reserves stand at 35 billion barrels. It is believed to be the largest oil field in the world after Prudo Bay in Alaska. Besides, natural gas reserves are estimated at over 1 trillion cubic meters.
The commencement of commercial production at Kashagan is expected by mid-2013. The first phase of the project envisions the volume of production at around 370,000 barrels of oil per day with a possible increase to 450,000 barrels. The second phase envisages increasing production to 375,000 barrels per day within at least three years.