Minister: Need in Kazakhstan Caspian Transportation System to occur no earlier than 2020

Astana, Kazakhstan, Nov. 16 By Daniar Mukhtarov - Trend: The need in the Kazakhstan Caspian Transportation System (KCTS) project will emerge no earlier than 2020, Kazakh Minister of Oil and Gas, Uzakbai Karabalin told Trend on Nov. 15. "The need in the KCTS project will occur no earlier than 2020," the minister said. Karabalin noted that the purpose of the KCTS is to secure Kazakh oil exports to international markets, mainly from the Kashagan field (second and third phases) through the Caspian Sea, via the Baku-Tbilisi-Ceyhan oil pipeline and other oil transport systems on the territory of Azerbaijan and other transit countries. "Capacity and staging of the system's development will be determined on the basis of the oil production volume on Kashagan (second and third phases). It is expected that at the initial stage, it will amount to 23 million tons a year," Karabalin said. The minister said that, given the full expansion of the Caspian Pipeline Consortium's (CPC) pipeline by 2015 as well as timing and volume of oil production in the North-Caspian project, "the need for the KCTS project will occur by the start of the Phase 2 of the Kashagan field's development, that is, no earlier than 2020". Karabalin also said that in this regard it was decided to suspend the project in 2011. "In the future, the project's schedule must be synchronized with the schedule of the development of Kashagan's second phase," Karabalin said. Meanwhile, production at the Kashagan - one of the largest deposits in the world - was suspended in September, two weeks after the start because of a gas leakage. Another gas leakage was detected almost immediately after the resumption of production in October. Initially it was assumed that production on Kashagan will be eight million tons next year and will rise to 12 million tons in 2015. According to the minister it was previously reported that the production at the large Kashagan offshore oil field may resume in the second half of December 2013, when it is expected to complete all procedures for analysis of the field's pipelines due to a gas leak. Oil production at the Kashagan field in Kazakhstan may resume in the second half of December 2013, the Oil and Gas Minister, Uzakbai Karabalin said after a plenary session of the Majilis (lower chamber) of the Kazakh Parliament. "This will be known after the results of all analyses. Analyses will take time. They can last until mid-December, the contractors said so," the Minister added. Karabalin gave an affirmative response to the question on whether the production may start after mid-December 2013. According to the Ministry of Oil and Gas, Kashagan was producing over 60,000 barrels of oil per day before the discovery of the second gas leakage. In November, commercial production was to stand at 75,000 barrels per day. Originally it was planned to start production at the Kashagan in 2005, but the timing of operation were postponed, which was explained by the project participants as the complexity in the offshore field's development.