Production could resume as early as 2016 for the Kashagan oil and gas project off Kazakhstan following the replacement of pipeline infrastructure, Total’s President of Exploration and Production Arnaud Breuillac told Bloomberg.
Production on the beleaguered US$50 billion project would resume by 2017 at the latest, he said.
Located in about 4200m of water in the northern Caspian Sea, Kashagan houses reserves estimated at some 35 billion bo and 52Tcf of gas. First oil was achieved on 11 September 2013, but a gas leak forced operations to close after a week. Another gas leak was detected on 9 October 2013, and the field, considered the world’s largest oil discovery in decades, has been sidelined ever since.
Reuters reported that Eni Chief Executive Officer Claudio Descalzi said on a late April conference call that Kashagan’s consortium had ruled out production for all of 2015. Two oil and gas pipelines would merit replacement, primarily due to insufficient welding in the carbon steel pipelines needed to operate in the brutal environment.
Kashagan is being developed in phases, with Phase 1's average production estimated by Total to be 300,000boe/d. In order to maintain production throughout the harsh winters and floating ice, offshore facilities were installed on artificial islands: smaller unmanned drilling island and larger, manned so-called hub islands. Phase 2 is currently under development.
“This is clearly the mother of all projects,” Breuillac told Bloomberg. “The combination of challenges on this project are without equivalent in our industry.”
The North Caspian Operating Co. consortium operates the Kashagan field, and is comprised of Italy’s Eni, ExxonMobil, Shell, France's Total and Kazakh state oil company KazMunaiGas, each with 16.8%, along with Japan's Inpex (7.63%) and China National Petroleum Corp. (8.3%).
Image of the Kashagan development from NCOC.