Kashagan oil field inching toward design capacity

The operating company said it's using a confidence-building strategy to ramp up production at a field plagued by tough working conditions.
By Daniel J. Graeber  |  Feb. 19, 2018 at 8:59 AM
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Feb. 19 (UPI) -- It could take the rest of the year for the Kashagan oil field in the Kazakh waters of the Caspian Sea to reach its full design capacity, the operator said.

The Kashagan oil field offshore Kazakhstan was declared a commercial prospect in 2002. Development, however, has been impeded by a series of issues with infrastructure in a complex reservoir environment.

Production moved in fits and starts after the commercial declaration and finally resumed in October 2016 following several years of delays brought on by an extreme operating environment with high levels of poisonous hydrogen sulfide.

The North Caspian Operating Co., the field's operator, said in an emailed statement it was dedicated to reaching a design capacity of 370,000 barrels of oil per day at the earliest possible date.

"NCOC indicates that it expects that it will need the year to fully accomplish this capacity, and will study options to accelerate this timing," a spokeswoman said.

Oil is Kazakhstan's primary export commodity and the country is party to a multilateral effort led by the Organization of Petroleum Exporting Countries to balance an oversupplied market with managed production declines.

Economists at OPEC said in their monthly market report for February that crude oil production from Kazakhstan for the year could increase marginally, by about 90,000 barrels per day, slightly less than last year. Crude oil production in December, the last full month for which OPEC published data, was steady at 1.54 million barrels per day.

The NCOC said it would carry out a steady sequence of planned steps to build confidence in Kashagan infrastructure in its approach to increasing production.

Exports would rely on a mix of existing pipelines and rail. A possible new route for pipelines from the southwest could link Kashagan up to more cross-border and international markets.

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