Oil production at Kazakhstan’s vast Tengiz oil field, one of the world’s largest, could be halted for another 7-10 days after shutting down on Sunday, cutting crude exports via the Caspian Pipeline Consortium, three industry sources told Reuters.
The field’s operator Tengizchevroil (TCO) said on Monday that due to power supply problems, production at the Tengiz and Korolevskoye field had been stopped.
A day earlier, on January 18, a fire broke out at two turbine transformers at the field’s GTES-4 power station, according to Kazakhstan’s state-owned national oil and gas company KazMunayGas.
“TCO’s output is down until the end of the week, but this could last until February,” one source said.
Three sources added that due to the incident, TCO had already cancelled five export cargoes of CPC Blend crude, totaling about 600,000–700,000 metric tons, scheduled to be shipped from the CPC’s Black Sea terminal in January and February.
Chevron, TCO’s largest shareholder, did not immediately respond to a Reuters request for comment. The sources were speaking on condition of anonymity.
TCO’s press service confirmed in response to a Reuters inquiry on Tuesday that, “as a precautionary measure”, production at Tengiz and Korolevskoye has been temporarily suspended, without specifying the cause of the fire at the production facilities or the date when production would resume.
OTHER PRODUCERS RAISING OUTPUT, SOURCE SAYS
The fall in Tengiz oil output has not yet affected Kazakhstan’s overall production as other producers increased extraction, one of the sources familiar with the data said.
Kazakhstan’s crude production fell by 35% in the first 12 days of January compared to December amid restrictions on CPC exports.
However, in the following days, output began to grow rapidly at two giant Caspian fields, Kashagan and Karachaganak, according to the source.
Kashagan increased its average daily production by 28% to 197,000 barrels over January 1–19 compared to January 1–12, while Karachaganak’s output rose by 21% to 156,000 barrels. Tengiz production in the period increased by 6% to 360,000 barrels per day.
The press services of the two fields’ operators, Karachaganak Petroleum Operating and NCOC, did not respond to Reuters’ requests for comment.
“NCOC and KPO are partially offsetting the Tengiz shutdown, but in a few days CPC will begin to reduce throughput,” the source said.
Kazakhstan exports most of its oil via CPC, but due to damage to the infrastructure at the marine terminal in Yuzhnaya Ozereyevka, some crude is being redirected to the Baku-Tbilisi-Ceyhan (BTC) pipeline and to Germany via the Druzhba pipeline.
In addition to U.S. company Chevron, which holds 50% of TCO, other project partners include ExxonMobil with 25%, KazMunayGas with 20%, and Lukoil with 5%.
(Reuters reporters in MOSCOW, additional reporting by Robert Harvey in LONDON; editing by Guy Faulconbridge and Jan Harvey)