Kazakhstan authorities have given Kashagan operator North Caspian Operating Company (NCOC) the all-clear to press ahead with a long-held plan to dredge navigational channels to existing artificial production islands on the Caspian Sea project.
Despite global environmental pressures to reduce the scope of fossil fuel developments, Kazakhstan continues to view its oil and gas assets as a key driver for its long-term economic development and the main source of budget revenues.
The drdged channels will help NCOC use its existing fleet to transport personnel, supplies and equipment to the field's five islands.
The shallow-water field is still in its first phase of development, despite an estimated $50 billion of investments being pumped into the project over the past two decades
Two additional phases are under discussion with authorities to bring the asset to a peak plateau output of 1.1 million barrels per day in 2055 or later.
NCOC, which presented the channels plan to the public last year, said that the water level around the islands has dropped by over one metre since 2005.
The operator added that construction works under the project are now planned to begin next year.
Scope of planned work
This work will be divided into two phases: construction of a long navigational channel in the sea to reach the group of islands; and a connecting channel to link them together, including several vessel turning basins.
The total length of all channels will be about 56 kilometres, NCOC said during public hearings last year.
NCOC has yet to reveal the estimated cost of the project but has said that it will involve removing more than 18.5 million cubic metres of soil to achieve the channels’ depth of over five metres and a width between 80 and 115 metres.
The operator dismissed earlier environmental concerns, saying it will contract modern dredging equipment with the least impact on the seabed to minimise any potential damage to marine life.
Reserves upgrade for onshore brownfield
State-owned oil and gas holding KazMunaiGaz, meanwhile, has ambitious plans for several offshore greenfields in the country’s Caspian Sea waters and is continuing the flow of investments into onshore brownfield projects.
This week, authorities cheered a sudden upgrade of reserves at the Karazhanbas field in the Mangistau region, where development started in 1980s.
According to operator Karazhanbasmunai, a recent exploration well, drilled into a previously untapped formation at the deposit, flowed at the rate of about 44 barrels of water-free oil.
The operator said that recoverable reserves of the new formation have been assessed at about 39 million barrels.
The field is an asset with challenging geological structures, hosting heavy viscous oil and wells with low flow rates, with close to 1900 holes built on the deposit during its lifetime.
China’s state investment house Citic Group and KazMunaiGaz have equal 50% stakes in Karazhanbasmunai via a web of foreign-registered companies.