Kazakhstan’s Kashagan oil giant will be a regional bellwether, Ashley Sherman, principal analyst on Wood Mackenzie’s Russia and Caspian upstream team, told Trend.
Sherman noted that the thoughts about the Caspian’s upstream competitiveness often lead to Kashagan, and for good reason. Its long-term development plan must resolve multiple commercial and technical conundrums.
“There are immediate milestones to ponder, not least the need for Kashagan’s updated full-field development concept to receive official approval later in 2021. This will enable studies to continue on a mix of pre-FID phases to boost oil production capacity,” he said.
In his words, the work over the next few years will truly test the majors’ appetites for another long-lead investment project in the Caspian region.
“If Kashagan expansion is to be realised, it will be thanks to successfully addressing the challenges,” he added.
The Kashagan field is one of the three largest oil fields located in the northern part of the Kazakh sector of the Caspian Sea. Its recoverable reserves reach approximately 9-13 billion barrels (1-2 billion tons) of oil.
The first commercial oil production started at Kashagan in 2016. The project operator North Caspian Operating Company (NCOC) shipped the first million tons of oil for export in early 2017. NCOC has reached a record-breaking volume of oil extraction at the field (390,000-400,000 barrels a day) in 2019.