Kazakh oil production to rise in midterm

Kazakhstan

ASTANA, February 25, 2015 – The restart of production from the Kashagan field and expansion of the Tengiz project will boost Kazakhstan’s oil production by almost 30 percent by 2020, Deputy Energy Minister Uzakbai Karabalin told a news conference Wednesday.

Tuesday, Energy Minister Vladimir Shkolnik said a final decision on the $40-billion Future Growth Project at the Tengiz oilfield was expected in 2015. The development would increase its annual production from 194 million to 283 million barrels.

“In 2017, we expect oil production to rise to 86 million tonnes [630 million barrels], and in 2020 to grow to 104 million tonnes [762.3 million barrels],” Karabalin said.

The Kashagan field was shut down in 2013, weeks after going into production, when 200 kilometres of leaking pipelines added $4 billion to the $50-billion project. Kashagan holds 13 billion barrels of proven reserves.

On Monday, Shkolnik said 2015 output would remain steady from 2014 at 590 million-592 million barrels. Lower oil prices will cut into profitability, as the cost of production averages $50 per barrel in Kazakhstan.