After A String Of Setbacks, the giant Kashagan Field Is Showing Results
After a rough begin, the blood sweat and tears poured into the Kazakhstan's Kashagan oil field within the caspian sea are beginning to show some results. This past month, the field produced around 201,000 tonnes or one,698,450 barrels of oil according to knowledge from the country’s energy administration.
The october output for the field reached concerning 52,600 barrels per day, that whereas a promising begin, is still below the estimated number of 75,000, that is that the level required for the sphere to hit stable production. Some oil majors had conducted check pumping in september, and a limited amount of product was exported.
Kazakhstan’s efforts to develop its resources within the Caspian are costly in terms of money, time and work. The Caspian fields have go along with a price tag of $55 million for development.
Production work in the Caspian fields actually kicked off about 3 years past, however it’s been a rocky 3 years. One month when operations got underway, work came to a halt once a gas leak led to the discovery of a 200 kilometre stretch of pipeline riddled with micro-cracks caused by the high sulfur content of the gas being transported.
Adding to the production woes within the Kashagan oil field are problems with high-pressure reservoirs that have had a high sour gas content, not to mention weather. The Caspian experiences freezing conditions that make pack ice, that in turn presented different obstacles in terms of logistics. Operators were forced to mitigate those problems by making artificial islands wont to store equipment, to house equipment, staff members and to create space for process facilities. Investors within the Kashagan operation embody KazMunayGas, Chevron, Eni, ExxonMobil, Royal Dutch Shell, Total, CNPC and Inpex; the operator is that the North Caspian operating Company.
While recent developments within the Kashagan field are excellent news for kazakhstan, those investors can still be tasked with recouping their money. A fitch Ratings report last month noted “It are going to be a challenge for partners to recover their investment within the project under our oil price projections, creating an expansion of the project unlikely given different risks. As for several different mega-oil-and-gas projects launched over the last couple of years, it'll be difficult for Kashagan to recover its capex based on our long brent worth assumption of [US$65/bbl], despite the weak tenge.”