Archive special issue
#2 (80), April 2013A special issue devoted to the ATYRAU OIL & GAS - 2013 Exhibition
The Atyrau region is the main supplier of hydrocarbon raw materials in Kazakhstan. Soon, commercial development of Kashagan, the largest field discovered in the last 40 years, will start here. This will lead Kazakhstan to the world’s five largest suppliers of oil.
At the same time, the region should go through many difficulties, because completion of the construction of facilities of the North Caspian project will release thousands of jobs, while the start of the field’s operation will lead to environmental risks. Do the local authorities keep up with the decision of the region’s vital issues which are not limited only to oil production? Our talk with Baktykozha Izmukhambetov, Atyrau oblast Akim (head of regional administration), is about it.
Scott Davis, Chevron EBU Managing Director, answers the following questions for Petroleum
- Chevron came to Kazakhstan twenty years ago, having concluded a contract on establishment of a joint venturefor Tengiz field development. Today, after two decades, how do you assess the Tengiz position among Chevron’s global projects throughout the world?
Bruno Jardin, Managing Director of ExxonMobil Kazakhstan Inc., answers the following questions for Petroleum
- ExxonMobil is celebrating the 20th anniversary of its presence in Kazakhstan. In fact, the company came practically at the same time when Kazakhstan gained its independence. Jointly with the country, your company has walked a long path of success and achievements. On the eve of your anniversary, which achievements would you like to highlight?
Tengizchevroil JV marks the 20th anniversary of its activity. On April 6, 1993, in Almaty the President of Kazakhstan Nursultan Nazarbayev and the chairman of the board of Chevron Corporation Kenneth Derr signed a 40-year agreement on forming Tengizchevroil LLP. The joint venture was established between Chevron Overseas Petroleum Inc. and Tengizneftegas Production Association. Since then, for two decades already ТCO is one of the leaders in the country’s oil and gas industry.
The North Caspian consortium, developing the huge Kashagan field in the Kazakh sector of the Caspian Sea, is preparing for the start of commercial production. There is no doubt that the Kashagan oil will become the basis for energy security of the Republic of Kazakhstan in the 21st century. When we talk about the Consortium, we mean not just multi-billion investments and innovative technologies, but also the Consortium’s social commitments in the region it operates.
Karachaganak Petroleum Operating B.V. (KPO), developing the Karachaganak oil and gas condensate field in Western Kazakhstan, has announced the operation results of 2012. Last year KPO produced 139.5 million barrels of oil equivalent of stabilised and unstabilised liquid hydrocarbons, gas and fuel gas. 8.6 million cubic meters of sour dry gas were re-injected to maintain reservoir pressure, which is approximately 49% of the total volume of produced gas.The volume of gas flaring was a mere 0.13% of the total volume of gas produced. More than 1 million tonnes of greenhouse gas emissions have been eliminated. As a result of KPO’s efforts to substitute foreign specialists, today, local employees make up 93% of the total staff.
The yield of light oil products also increased. During 2012 the experts of PetroKazakhstan Oil Products made extensive efforts to improve the quality of refinery products. The preparation for the Shymkent refinery modernization program to cover the construction of 7 new process units and the reconstruction of 3 existing process units is ongoing. The purpose of the Refinery Modernization and Reconstruction Project is to start producing oil products to Euro-4 and Euro-5 standards and to increase the conversion depth and the yield of light oil products.
Sakhalin Island, Russia: recently, this place has gone through a dramatic transformation that would seem unimaginable just fifteen years ago. This island with an ailing economy, located far away from the traditional of economic and industrial centres, has turned into a showcase of state-of-the-art technology, innovation and rapid socioeconomic development.
The history of AtyrauNefteMash mechanical engineering plant started during the first quarter of the last century, when a new plant was established on the basis of mechanical workshops previously used to service waterborne and railway transport. This new plant launched production of equipment for petroleum operations.
The total forecasted recoverable resources of hydrocarbons in Kazakhstan are estimated at 17 billion tons, of them 8 billion tons fall on offshore fields. The main growth of oil production in the country will be provided by offshore fields, while the majority of oil fields being developed on land have already reached their maximal level of annual production. So, further growth of onshore production is connected basically with intensification of Теngiz and Каrachaganak fields’ development. Therefore, the situation with the development of the Kazakhstan sector of the Caspian Sea is a key one for Kazakhstan.
Telecommunication company ASTEL has been providing communication services at the North Caspian project’s facilities, including artificial islands for eight years already. The company’s services meet both international standards and high demands of the operator of Kashagan project. The work at the legendary Kashagan has become a stimulus for ASTEL to accustom international standards, develop a wide spectrum of services, introduce ISO and OHSAS certification and continuously improve the professional skills of its employees.Kirill Yelantsev, ASTEL’s Head of International Projects Division, shares the nuances of work with NCPOC in an interview to Petroleum.
Mr Bertrand Le Guern, chairman of the board of Petrolinvest SA, for the first time gives an interview to the Kazakhstan press. He tells Petroleum about the achievements and plans of the first Polish investor in the Kazakhstan’s oil and gas sector
The international consortium North Caspian Operating Company (NCOC), preparing to start commercial production at Kashagan, announced the second largest commercial discovery: at the Kalamkas-sea field. Press-service of the national company КаzMunayGas has officially confirmed this news 3 months later. As inform the sources, the time has been chosen not accidentally. Three companies from among the project participants have managed to reach an agreement on principles on forming a separate company to develop the field.
Evidently, it’s not an open secret that the authorized body in the person of the Ministry of Oil and Gas of the Republic of Kazakhstan controls a proportional parity of investors from among large geopolitical players. Moreover, possessing the right of veto, the Ministry has a possibility to regulate the presence of these or that countries in the Kazakhstan’s oil and gas industry.
Discussion of Available Means to Mitigate Legal Risks Faced by Foreign Investors Doing Business in the Republic of Kazakhstan
Foreign companies face a variety of legal risks in the course of doing business in the Republic of Kazakhstan (RoK). Inadequate laws, corruption, lack of transparency of courts and regulatory authorities, unpredictability of judgments issued by state courts, in the author’s view, represent the greatest risks when doing business in the RoK.