Azernews.Az

By Aynur Jafarova

Kazakhstan and Tengizchevroil LLP (TCO) signed a Memorandum of Understanding (MoU) on November 15 that sets out mutual commitments to further TCO's plans to increase production in the Tengiz field.

The project envisages increasing oil production in Tengiz field from 26 million tons to 38 million tons of oil per year.

Signing of the MoU is an important milestone on the path to a final investment decision for the projects by TCO partners.

Oil and Gas Minister Uzakbai Karabalin believes that the MoU aligns the Kazakhstan government and TCO on the pursuit of common goals in the development of TCO's Future Growth and Wellhead Pressure Management Projects (FGP and WPMP), and outlines tasks to be accomplished by the signatories in order to execute FGP and WPMP.

FGP will utilize sour gas injection technology used in existing operations to expand production capacity by approximately 12 million tons per year.

Through installation of a central pressure boost facility, WPMP will maintain the volumes and pressure of crude oil delivered to the existing Tengiz crude oil processing plants. The projects are currently completing the front end engineering and design (FEED) phase.

Governor of Kazakhstan's Mangistau region Alik Aidarbayev said that the Aktau port will handle four million tons of oil from the Tengiz field.

"We have recently signed a contract with Tengizchevroil for handling four million tons of Tengiz oil through the port of Aktau," Aidarbayev said.

The Tengizchevroil Consortium, which engaged in developing Kazakhstan's Tengiz and Korolev oil fields, is a Kazakh-American joint venture involved in the exploration, development, production and marketing of crude oil and related products. The company is the largest oil producer in Kazakhstan, founded on April 6, 1993 by the Kazakh president and the Chevron Company.

TCO shareholders are Chevron (50 percent), KazMunaiGas (20 percent), ExxonMobil (25 percent) and LukArco (5 percent).

TCO currently supplies oil all around the world mainly via the Caspian Pipeline Consortium (CPC) system. Its marketing policy is based on three important points: oil transportation safety, reliability of terminals and refineries that receive Tengiz's oil, and export diversification.

The Tengiz oil field was discovered in 1979 and is one of the deepest and largest oil fields in the world. The reserves of the Tengiz field are estimated to contain 750 million to 1.1 billion tons (6-9 billion barrels) of recoverable oil.