Kazakhstan authorities have implicated two Western-led oil and gas developments as the cause of an almost 3% drop in the country’s oil production this year, The Caspian Post reports citing foreign media.
The two projects cited by the government - Tengiz and Kashagan - were blamed for the decline in the country’s output to about 1.83 million barrels per day.
Tengiz and Kashagan, together with Karachaganak, are the three leading foreign-led oil and gas developments in the country.
Energy Minister, Almasadam Satkaliyev, earlier this week said during a government meeting in Astana that the downward revision in the country’s oil output was initially caused by a long turnaround of offshore facilities at the Kashagan field in the Caspian Sea.
Led by Italy’s Eni and UK supermajor Shell, Kashagan stopped production for three weeks in October for a full turnaround of its offshore facilities.
The decision to proceed with the maintenance plan came despite a previous government request to postpone the outage amid concerns over domestic gas shortages in the country.
According to the Energy Ministry, the turnaround is forecast to result in Kashagan’s oil and condensate production to fall to about 345,000 bpd this year, a drop of over 7% against 2023.
However, the impact on the country’s total production from Kashagan’s shutdown has been exacerbated by the partial shutdown of a sour gas and sulphur treatment unit at the Tengiz field at the end of October, Interfax-Kazakhstan news agency quoted the minister as saying.
Tengiz is the country’s largest onshore development and is operated by the Chevron-led Tengizchevroil venture.
The sour gas and sulphur treatment facility is one of four integral parts of Tengiz’s second generation plant (SGP), which was commissioned in 2008 and removes poisonous hydrogen sulphide from the stream of hydrocarbons by converting it into elementary sulphur.
According to Satkaliyev, Tengizchevroil had to shut down one of the waste heat exchangers inside the facility’s perimeter for unplanned repairs following the discovery of internal structural damage, reportedly caused by rust, on 26 October.
Tengizchevroil initially expected repairs to be complete by 23 November, but in an update to the ministry, the operator said the repairs would not now be completed before the end of December, Satkaliyev said.
The partial shutdown has led to a major decline in the field’s oil production, which fell by 20% against the initial output plan to 494,000 bpd earlier in December, a statistics department within the Energy Ministry was quoted as saying by Reuters.
In early November, US major Chevron, which holds a 50% stake in the Tengiz project, said that following the commissioning of newly built oil and gas processing facilities and wells at the field under the multibillion-dollar FGP-WPMP capacity expansion project, in October the field achieved the highest daily oil ouput in the company’s 31-year presence at the development. However, the Energy Ministry now expects Tengiz's 2024’s oil production to be 2% lower versus last year at 566,000 bpd because of the partial shutdown and two earlier turnarounds that the operator prepared for commissioning of the FGP - WPMP project.
These two turnarounds lasted for a total of 50 days in May and August, the ministry said.
Tengizchevroil said in a statement to Upstream: “To ensure safe and reliable operations, the operator conducts necessary maintenance works on equipment at its facilities.
“Beyond this, Tengizchevroil does not comment on current or future production levels. The delivery of crude oil from the Tengiz field to the Caspian Pipeline Consortium remains uninterrupted.”
More than 90% of Tengiz’s oil is exported to international markets, mostly to Europe, via the Caspian Pipeline Consortium-operated line running from the Tengiz field to a marine export terminal near the Russian Black Sea port of Novorossiysk.
