By Vestnik Kavkaza
Oil production in the Kazakhstan oil field of Kashagan will start no earlier than the end of 2015, and only after reconstruction of a 200-km pipeline. The Minister of Economy and Budget Planning, Yerbolat Dosayev, says that the postponement means a loss of 0.5% of the GDP for Kazakhstan this year.
“Kashagan was presented as the biggest oil field to be explored in recent years,” Eduard Poletayev, Kazakhstan expert, told Vestnik Kavkaza. “It was presented in Kazakhstan as the project of the century; foreign investors paid great attention to it; and there were very favorable conditions. A restricting factor for successful exploitation of Kashagan were the difficult natural conditions, even for experienced foreign oil companies.”
Stanislav Pritchin, expert of the Center for Central Asia and Caucasus Studies of the Institute of Oriental Studies of the RAS, Stanislav Pritchin, commented on the situation for Vestnik Kavkaza
- Oil production is postponed in Kashagan. Won’t the situation turn into a row, considering the fact that billions are invested in the project?
- In general the situation is rather difficult, as when Kashagan began being explored, it was found out that the project is much more difficult and more expensive. The oil appeared to be more sulfur crude and the conditions appeared to be more aggressive. That’s why we are seeing another postponement. Of course the issue is very important for Kazakhstan. Other projects are not so promising, while Kashagan was a foundation of the oil production strategy. It was planned that 150 million tons of oil would be produced by 2015; later the volume reduced to 100 million in 2015. Now there is a trouble with Kashagan, and the plan has to be corrected. Of course we won’t do without certain sanctions against investors and operators; but it is a significant issue for Kazakhstan, which will negatively influence economic growth.
- How could engineers make such a mistake concerning pipelines which can’t transport Kashagan’s oil? And what are prospects of the oil field?
- The situation is unprecedented, as this is not the first postponement. Initially it was explained by the fact that the operator was an Italian company which had no experience of production in such difficult oil fields; but later it was found out that other operators had no such experience either. The project is very difficult; the territory is shallow-water. Details are important.
However, it was a big surprise for the experts, as usually investors try to foresee all risks and play safe, I mean in the sphere of infrastructure.
