Chevron bucks market to invest $37bn in Kazakhstan’s Tengiz oil field

 

Tengiz oil fieldChevron affiliate Tengizchevroil (TCO) is to go ahead with the development of its Future Growth and Wellhead Pressure Management Project (FGP-WPMP) to ramp up crude oil production at Kazakhstan’s Tengiz oil field from 27m to 39m tonnes a year at a cost of $37bn, Kazakhstan’s Energy Ministry and its foreign partners confirmed yesterday.
The Tengiz expansion is the biggest final investment decision taken by the oil industry this year and comes at a time when energy companies are tightening their belts due to low oil prices.
“Today we are witnessing a historic event, not just for the oil and gas sector but for the whole country,” Kazakh Energy Minister Kanat BozumbayevKazakh Energy Minister Kanat Bozumbayev told reporters in Astana, and predicted that the expansion would generate about $120bn in extra tax payments by 2033 when the contract expires.
Chevron owns 50% of TCO along with ExxonMobil (25%), KazMunayGas (20%) and LukArco (5%), and is also the largest private shareholder in the Caspian Pipeline Consortium, which operates the 935-mile crude oil pipeline from Tengiz to Novorossiysk on Russia’s Black Sea coast.
FGP-WPMP will use sour gas injection technology developed during TCO’s previous expansion in 2008 to enhance oil recovery and the additional production capacity is expected to be on stream by 2022. The investment was “well-timed to take advantage of lower costs of oil industry goods and services,” Chevron’s Executive VP for upstream Jay Johnson said. .

Source: ogj