Terminal Closure Puts Kazakhstan on Red Alert

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Kazakhstan and its Western oil partners including Chevron, Shell, Eni and Exxon Mobil are fretting over the unexpected closure of the 1.5 million barrel per day Caspian Pipeline Consortium (CPC) terminal outside the Black Sea port of Novorossiysk that transships most of the oil they produce, leaving them with few alternatives to get their oil to market. In what remains an uncertain picture, the Russian head of the CPC group, Nikolai Gorban, said on Mar. 23 that throughput from the terminal could be reduced to minimal levels — around 300,000 b/d — over the next two months as repairs are made to fix damage caused by a storm. He said two of the three single point moorings at the terminal needed repairing, while the third could not be inspected due to the bad weather. As Petroleum Intelligence Weekly went to press, the 1,510 kilometer pipeline that links the terminal to Kazakhstan’s giant Chevron-operated Tengiz field was due to stop operating because the terminal’s storage tanks were full up. Kazakhstan's energy supremo, Bulat Akchulakov, tried to downplay the impact of the stoppage by saying other export routes could be used to handle some of the lost barrels such as shipping them across the Caspian Sea or using a second pipeline running north to Russia. Industry sources say two months without CPC is just about manageable for Kazakhstan’s oil producers, but any longer may leave them with no choice but to start shutting in production.

Offshore Oil and Gas, Oil Supply, Oil Pipelines
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