The Kashagan Oil Field Essay

3944 words - 16 pages

KASHAGAN An Offshore Oil Field Project in Kazakhstan
wais anwari wais.anwari@gmail.com
Abstract International Oil and Gas Markets provided by Olga Garanina

Content
1. Introduction ............................................................................................................................ 1
1.1 Key Field/Project indicators .................................................................................................. 1
2. Project Overview ..................................................................................................................... 2
2.1 The Project ............................................................................................................................. 2
2.2 Project Development and Sponsors ..................................................................................... 4
2.3 Kashagan North Caspian Production Sharing Agreement (PSA) ......................................... 5
3. Role of the Field for Regional oil/gas Supplies and for the companies ..................................... 6
4. Project Risks and Solutions ...................................................................................................... 9
5. Conclusion ............................................................................................................................. 11
6. Appendix ............................................................................................................................... 12
7. Bibliography .......................................................................................................................... 14
Map of the Caucasus and Central Asia
Source: Source: http://www.lib.utexas.edu/maps/commonwealth/caucasus_cntrl_asia_pol_2003.jpg, accessed
October 29, 2011

Kashagan Oil Field Project Wais Anwari
1
1. Introduction
Kashagan field refers to an offshore oil field in Kazakhstan's zone of the Caspian Sea.
The field, discovered in 2000, is located in the northern part of the Caspian Sea close
to Atyrau and is considered the world's largest discovery in the last 30 years. It is estimated
that the Kashagan Field has recoverable reserves of about 13 billion barrels of crude oil. Harsh
conditions, including sea ice during the winter, temperature variation from −35 to 40 °C,
extremely shallow water and high levels of hydrogen sulfide, project delays together with
mismanagement and disputes, make it one of the most challenging oil megaprojects. Although
the Kashagan oil field was supposed to be completed and pumping oil by 2005, it was still under
construction in early 2007. In July 2007, one of the project sponsors Eni (the Italian energy
company) confirmed the rumors that the production would not start until late 2010, and there
was going to be a significant cost increase from $10b tot $19b for the first phase of the project,
and from $57b to as much as $136 billion for the total project. Finally after years of delay and
renegotiation...

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