Country may offer producers up to 200,000 barrel per day of alternative additional export capacity
Kazakhstan is ready to start the next phase of a long-discussed expansion of its oil pipeline network aimed at offering the country’s producers to export up to 200,000 barrels per day of oil to China.
Speaking this week at an industry event in Astana, Kazakh Energy Minister Almasadam Satkaliyev said a pre-front-end engineering and design study to determine the initial technical requirements for the expansion project has been completed.
He said the ministry is now working with Kazakh producers to fulfil a China National Petroleum Corporation (CNPC) request for long-term oil supplies.
Satkaliyev said that once these guarantees are in place, Kazakh state-run pipeline operator Kaztransoil and CNPC will be able to take a final investment decision on the expansion plan.
The plan calls for throughput capacity upgrades at two segments of the Kazakh trunkline network — one between the cities of Atyrau and Kenkiyak, and a longer one between Kenkiyak and Kumkol.
Additional pumping stations have to be built at these two segments, and the flow of oil reversed in the Atyrau-Kenkiyak line to enable more volumes to be carried from Atyrau to Kazakhstan’s eastern border with China.
State-controlled oil and gas producer KazMunayGaz said earlier this year that the capacity of the Atyrau-Kenkiyak segment is set to increase by 120,000 bpd, and Kenkiyak-Kumkol’s by 100,000 bpd.
The upgrades are anticipated to be completed within two-to-three years.
Atyrau is a major oil hub in Kazakhstan handling oil and condensate output from country’s three largest Western-led developments — Tengiz, Kashagan and Karachaganak — as well as others in the country.
The hub hosts connections to the Caspian Pipeline Consortium and the Atyrau-Samara legacy link to the Russian oil pipeline network.
Caspian Pipeline Consortium operates a 1500-kilometre modern pipeline that carries about 80% of Kazakh’s oil exports to a dedicated marine terminal near the Russian Black Sea port of Novorossiysk.
The pipeline is expected to transport about 1.33 million bpd of Kazakh and Russian oil this year, a Caspian Pipeline executive said this week in Astana, with debottlenecking upgrades completed earlier this year lifting boosting the network’s total nameplate capacity to 1.73 million bpd.
Last year, Kazakhstan President Kassym-Jomart Tokayev called for the country’s privately-held oil producers and KazMunayGaz to urgently consider alternative oil export routes to help reduce the country’s dependence on Russia as a transit country.
International ratings agencies believe Kazakh oil exports via Russia carry an increased risk because of the international sanctions against Moscow following its invasion of Ukraine early last year.
For the whole of 2023, Kazakhstan expects oil exports to exceed 60,000 bpd via a reopened alternative route from the Kazakh port of Aktau across the Caspian Sea to Azerbaijan, where Kazakh oil enters the Baku-Tbilisi-Ceyhan pipeline.
However, the country has been also seeing sizeable increases in oil flows via Caspian Pipeline and the Atyrau -Samara link this year, according to the country’s industry social network channel Energy Monitor.(Copyright)
Source : Up Stream