Russian pipeline manufacturer TMK pipe is set to bid for a tender to replace two subsea pipelines running from artificial production islands on the Kashagan field in the Caspian Sea to the Bolashak onshore processing plant in Kazakhstan, according to a top company executive.
Speaking to Upstream on the sidelines of the World Petroleum Congress, TMK board chairman Dmitry Pumpyansky said that the company is confident it has the requisite steel alloy blend to withstand aggressive nitrogen sulphide that is produced together with hydrocarbons on the field.
Onshore pipelines are also expected to be replaced, energy minister Uzakbay Karabalin said earlier at the Moscow event.
The Kashagan field, operated by an international consortium led by US supermjaor ExxonMobil, is located about 80 kilometres from shore, and is the largest offshore deposit in Kazakhstan.
Production at the field started in September last year. However, it was halted in October after multiple gas leaks and pipeline cracks were discovered.
Compared with other contenders, TMK may compete with other pipe mills on price because Russia and Kazakhstan are located in the united customs zone, where both countries have agreed not to charge import taxes, according to industry observers in Moscow.
TMK has in the past decade become one of the three largest steel pipe producers in the world, following massive investments to upgrade its mills in Russia, the US and other countries, Pumpyansky said.
Kashagan’s operator, the North Caspian Operating Company, hit the market with preliminary inquiries covering replacement pipelines in February, with a full tender expected to be announced later this year.
Karabal said this week via an interpreter at WPC that the country will have to “grin and bear” continued delays with the re-start of oil production at Kashagan.
The consortium will have to contract, manufacture and deliver new pipes, and then wait for the right time to lay them to minimise disturbance to the subtle Caspian environment.