The giant Kashagan field is the largest oil discovery in the last four decades. The estimated 2P oil and condensate reserves life is over 120 years at the 2019 production level.
The North Caspian project is the first major offshore oil and gas project in Kazakhstan. It includes five fields: Kashagan, Kalamkas-Sea, Kairan, Aktoty, and Kashagan South-West fields. The areas of the Kalamkas-Sea and Kashagan SouthWest fields are in the process of being returned to the Republic of Kazakhstan.
The Kashagan field lies in an offshore location 80 km from Atyrau at water depths of 3 m to 4 m. The field reservoir lies at a depth of over 4 km and is characterised by high pressures (over 700 bar) and high hydrogen sulphide (H2S) content. At the same time, sour gas reinjection at high pressures enables enhanced oil recovery.
Kashagan is one of the most challenging industry projects globally due to harsh environmental conditions at sea and significant design, logistics and safety challenges. Located in the subarctic climate, the North Caspian Sea is covered with ice for about five months a year, requiring innovative technical solutions. KMG, together with international partners, is successfully implementing the project, having achieved sustainable production rates with further growth potential.
The Kashagan field construction design comprises onshore and offshore facilities. Onshore facilities include the Bolashak Onshore Processing Facility while the offshore facilities comprise a range of artificial structures including an operational and processing complex on Island D, Island A, and early production islands EPC2, EPC3 and EPC4. A total of 40 wells were drilled on the Kashagan field, 6 of which are injection wells and 34 production wells.
The Production Sharing Agreement in respect of the North Caspian Sea (NCPSA) was signed by the Republic of Kazakhstan and an international consortium in November 1997. The operator is North Caspian Operating Company N.V. (NCOC), acting on behalf of the contractors.
Currently, KMG has a 50% interest in KMG Kashagan B.V., which in turn holds a 16.88% interest in the Kashagan mega project. The remaining 50% interest, or 8.44% in the project, is owned by Samruk-Kazyna JSC.
In 2019, for the first time in Kashagan’s history, an overhaul was successfully completed with a total shutdown of all production facilities. The repairs enabled increases in oil and gas production from onshore and offshore facilities, as well as improving the utilisation rate to 98.4%.
Oil production from the North Caspian project was 14.1 mln tonnes (307 kbopd) in 2019. Production from Kashagan peaked at around 400 kbopd in 2019, while the average daily production was 344 kbopd in Q4 2019. Associated gas production was 8.4 bln m³.
KMG’s share of oil production from the Kashagan field increased by 6.9% to 1,169 thous. tonnes of oil (25 kbopd) while associated gas production grew by 10.4% to 700 mln m³.
Under the PSA terms, all oil produced from the Kashagan field is exported, including KMG’s entitlement share of production. The key export destination is the port of Novorossiysk, to which the oil supplies are pumped via the CPC pipeline. KazTransGas JSC is the sole buyer of gas from all contractors at the Kashagan field, with whom a single gas purchase and sale contract has been signed.
The premier asset of Kazakhstan’s Oil & Gas industry.
Tengizchevroil LLP (Tengizchevroil) operates a license that includes the unique, supergiant Tengiz field and the adjacent, smaller but still significant, Korolevskoye field. The Tengiz oil field was discovered in 1979, and it is the world’s deepest supergiant oil field.
Currently, oil production and processing are carried out at modern, highly reliable production facilities: KTL (throughput: 14.2 mln tonnes of processed oil in 2019), Second-Generation Plant (SGP, throughput: 15.6 mln tonnes of processed oil in 2019), and Sour Gas Injection (SGI, 3.65 bln m³ in 2019). At the beginning of 2020, the well stock comprised 156 production wells and 8 gas injection wells.
The agreement for the Tengizchevroil LLP project was signed on 2 April 1993 between the Republic of Kazakhstan and Chevron Corp. A 40-year hydrocarbon exploration and production license was granted to Tengizchevroil in 1993. Tengizchevroil is focused on the exploration, production, and sales of hydrocarbons from the Tengiz and Korolevskoye fields in the Atyrau Region.
KMG share in Tengiz’s oil production increased by 4.1% to 5,958 ths tonnes (130 kbopd) while gas production grew 4.2% to 3,258 mln m³ driven by stable operation and improved reliability of KTL, SGI/SGP facilities despite production stoppages for overhauls. From 1 August to 9 September 2019, Tengiz carried out a scheduled 40-day overhaul at KTL 1.
Outlook for Tengiz
Tengizchevroil is implementing two integrated projects – the Future Growth Project (FGP) and the Wellhead Pressure Management Project (WPMP). The implementation of the FGP-WPMP will boost oil production from the Tengiz field by 12 mln tonnes per year.
The Karachaganak oil and gas condensate field located in the West-Kazakhstan region is one of the largest oil and gas condensate fields worldwide with initial reserves of more than 1.2 billion
Karachaganak oil and condensate field is one of the largest oil and condensate fields in the world, located in the West Kazakhstan Region and covering an area of over 280 sq. km. The field was discovered in 1979, with pilot development started in 1984.
The Karachaganak project is developed under the Final Production Sharing Agreement (FPSA) signed on 18 November 1997 for a period of 40 years. Equity interests in the project are as follows: Royal Dutch Shell (29.25%), Eni (29.25%), Chevron (18%), LUKOIL (13.5%), and KMG (10%). Royal Dutch Shell and Eni are the joint operators of the Karachaganak project.
At the beginning of 2020, the operating well stock of the field included 156 producing wells and 18 injection wells.
Liquid hydrocarbon production from Karachaganak decreased by 7.3% to 1,015 ths tonnes (22 kbopd) in terms of KMG’s share. Gas production was 1,861 mln m³, down 1.6% year-on-year. The decrease in production was due to the complete shutdown of production facilities at the KPC, as well as Unit 2 and Unit 3 from 16 September to 10 October 2019 for scheduled preventive maintenance, which was the largest in Karachaganak Petroleum Operating B.V.’s history.
The fields have complex geological structure and its oil have high content of wax (up to 29%) and asphaltene component (up to 20%), which give the oil its high chilling point (+32С).
Field reserves account for approximately 75% of total explored reserves plus expected oil reserves and include the following fields:
the Uzen field (oil and gas)
the Karamandybas field (oil and gas)
the South Zhetybai field (gas and gas condensate)
the West Tenge field (gas and gas condensate)
the Aktas field (gas and gas condensate)
the Tasbulat (gas and gas condensate) and Uzen East (gas) fields
The Akshabulak structure was discovered in 1987, with initial testing performed in 1989. It is situated 60 km to the south of the large existing Kumkol oil field.
It is a major oil field in terms of reserves and oil production, and covers an area of 251 km2.
Oil production at Akshabulak was commenced in October 1996. Commercial oil is shipped using the 57 km Kazgermunai pipeline to the Kumkol field.
Oil fields in the Emba district cover a large land in semi-desert and sparsely populated areas. Associated gas together with oil is produced here.
Emba low sulphur-content oil is easy to process, and has particular value from its use in lubricants.
JSC Embamunaigas has 45 fields, with 33 in production. Nine are temporary abandoned and three are under development.
Of all of the Embamunaigas fields in operation, the following eight are regarded as major in terms of reserves and production levels:
- Kenbai (East Modabek / North Kotyrtas)
- S Nurzhanov
- South-West Kamyshitovoye
- West Prorva
- East Makat
- South-East Kamyshitovoye
37 of the Embamunaigas operating fields contain approximately 25% of its total explored and expected oil reserves.
The Zhambyl site is in the northern part of the Kazakhstan sector of the Caspian Sea.
Administratively, the Zhambyl site is located in Atyrau Oblast.
Water in the work area is 4–5 m deep.
The main oil and gas prospects are associated with terrigenous deposits of Jurassic and Lower Cretaceous complexes.
The contract for exploration of raw hydrocarbons was signed on 21 April 2008.
JSC NC “KazMunayGas”: 100%
Project Operator is LLP Zhambyl Petroleum which is registered in Atyrau justice bodies and acts on behalf of the Subsoil User.
2D seismic survey: 2,189.7 lin km and gravity and magnetic surveys: 3,890 lin km;
3D seismic survey: 400 sq. km in 2016, 600 sq. km in 2019;
2 exploration wells (2013, 2014) and 1 appraisal well (2018) were drilled in Zhambyl and Zhetysu structures, testing resulted in a free flow of oil and gas;
Processing and integrated interpretation of 2009–2010 3D and 2D seismic data;
Current estimation of reserves in Zhambyl and Zhetysu structures;
Processing and interpretation of 2019 seismic data are at the final stage;
Funding obligations for training Kazakh personnel and social projects are discharged.
Activities are under way to return the Contract for the Zhambyl site ahead of time.
The Zhenis site is in the southern part of the Kazakhstan sector of the Caspian Sea.
Administratively, the Zhenis site is located in Mangistau Oblast.
Water in the work area is 70–100 m deep.
The main oil and gas prospects are associated with Paleozoic and Mesozoic deposits.
Contract for exploration and production of raw hydrocarbons was entered into on 1 April 2019.
JSC NC “KazMunayGas”: 50%
LLP Lukoil Kazakhstan Upstream: 50%
Project Operator is LLP Zhenis Operating which is registered in Aktau justice bodies and acts on behalf of the Subsoil User.
Drilling of 1 well (3300 m)
3D seismic survey (250 km2)
Location and construction dates of the first exploration well V-1 were approved.
Activities are in progress to complete Work Programme under the Contract.
Isatay area is in the Kazakhstan sector of the Caspian Sea, 45 km north of the shore of Bozashy peninsula. Water near Isatay area is 4–8 m deep.
The main surveyed objects within the suprasalt sequence of the Isatay areas are Cretaceous, Jurassic and Triassic terrigenous deposits.
On 30 July 2014, Kazakhstan Ministry of Oil and Gas and KMG signed Protocol of Direct Negotiations resolving to grant KMG the subsoil use rights for combined exploration and production.
On 5 February 2015, the Kazakhstan Government approved Resolution on Execution of Contract for Combined Exploration and Production for Isatay area.
On 26 June 2015, a Contract for Combined Exploration and Production of Raw Hydrocarbons on Isatay area was executed.
On 22 June 2017, KMG and Eni entered into an Agreement on Transfer of the Share of the Subsoil Use Right for Isatay Project.
JSC NC “KazMunayGas”: 50%
ENI Isatay B.V.: 50%
LLP Isatay Operating Company acts as the Project Operator.
Background environmental studies;
A seismic survey of 237 lin km of Isatay area;
An exploration well is scheduled to be drilled.
The Project is being implemented under the Agreement between the Republic of Kazakhstan and the Russian Federation about the delineation of the bottom of the northern Caspian to exercise sovereign rights for subsoil use dated 6 July 1998 and the Protocol thereto dated 13 May 2020.
Khvalynskoye field is in the northern Caspian, where there is the licensed area of LLC LUKOIL-Nizhnevolzhskneft (license ShKS No. 11386 dated 22 January 2003).
The distance to the nearest Russian coast is 100–120 km. Water near Khvalynskoye field is 25–40 m deep.
Following geologic exploration, reserves of gas, condensate and oil in Lower Cretaceous and Upper Jurassic deposits were included in the state balance.
On 18 April 2003, the parties entered into an Agreement for Joint Development of Oil and Gas Resources of the field.
In March 2005, JSC NC "KazMunayGas” and PJSC LUKOIL established a joint venture – LLC Caspian Oil and Gas Company, which now acts as the Project Operator.
LLC Caspian Oil and Gas Company will obtain subsoil rights after PSA is executed.
In May 2009, a request was submitted to the Russian Government to establish an Inter-Agency Commission (IAC) to develop subsoil use conditions, prepare a draft PSA and start negotiations to execute PSA for Khvalynskoye field.
On 10 June 2011, Order No. 158 of the Ministry of Energy of the Russian Federation established the IAC.
At the moment, negotiations are ongoing with Russian state bodies about PSA, and with PJSC Gazprom about gas procurement conditions.
Correction of Field Development Plan and development of Industrial Estimation of Reserves in Khvalynskoye Field are coming to an end.
The prospect site of Bekturly East is located in Karakiyansky District, Mangistau Oblast, the Republic of Kazakhstan.
Bekturly East site is in the vicinity of active oil and gas fields such as Uzen-Karamandybas, Zhetybai, Bekturly, East Zhetybai, Aktas etc.
The site totals to 286.44 sq. km exclusive of mining allotments of Asar and Zhetybai East fields.
JSC NC “KazMunayGas”: 50%
LLP Kokel Munay: 50%
LLP Becturly Energy Operating acts as the Project Operator.
3D seismic survey of 354 lin km;
Drilling of a 3042 m deep exploration well;
In June 2020, testing of a BV-1 exploration well in Bekturly East resulted in a free flow of oil. In addition, hydrocarbon shows (oil gravity: 0.82 g/cm3) were observed in the previous testing targets by sampling from Middle-Jurassic and Lower-Jurassic, and in Trias sediments.
Dead Kultyk (Ustyurt)
The Dead Kultyk (Ustyurt) site is located in the south-eastern part of the Caspian coastal area.
The contract was signed in 2015.
In January 2018, a strategic partner – UnionField Group Ltd – joined the project to fund the Dead Kultyk (Ustyurt) project during exploration.
No work has been done for the project so far.
The Project is being implemented under the Agreement between the Republic of Kazakhstan and the Russian Federation about the delineation of the bottom of the northern Caspian to exercise sovereign rights for subsoil use dated 6 July 1998. Tsentralaya field is located in the Russian sector of the Caspian Sea. Water near the worksite is 350–500 m deep.
The field was discovered in 2008 as a result of geologic exploration.
In 2005, LLC TsentrCaspneftegaz (JV of PJSC Gazprom (50%) and OJSC LUKOIL (50%)) and JSC NC “KazMunayGas” signed an Agreement for Joint Development of Hydrocarbon Resources of the Tsentralnaya Geological Structure.
In 2013, LLC TsentrCaspneftegaz and JSC NC “KazMunayGas” established a joint venture (50/50) – LLC Tsentralnaya Oil and Gas Company which now acts as the Operator of Tsentralnaya Project.
In 2016, LLC Tsentralnaya Oil and Gas Company obtained the license for further exploration of the Tsentralnaya structure.
A set of activities is scheduled to develop and get an approval of the exploration well construction projects, and to drill two exploration wells.
- Reprocessing and reinterpretation of 3D seismic data;
- Feasibility study is being designed for field development.
Administratively, the worksite is in the far south-eastern part of Karakiyansky District, Mangistau Oblast, Kazakhstan, near the Uzbekistan border.
The contract territory of Samtyr is within South Ustyurt, the prospective oil and gas bearing zone.
To study the internal structure of the most prospective Jurassic complex (structural displacements, paleochannels etc.) the contracted site is scheduled to undergo a new high-resolution CDP seismic survey and drilling of 2 exploration wells.