Kazakhstan’s Kashagan field: it is just beginning

Azerbaijan, Baku, Sept. 13 / Trend / Trend commentator Elena Kosolapova This week Kazakhstan held an event which has been expected in this country and in the whole global oil market for nearly 10 years. On September 11 it was announced that the first barrels of oil were extracted from the Kashagan field. In recent years the whole economy of Kazakhstan has been planned taking into consideration the launching or not launching of this field. The forecasts on Kashagan were taken into consideration while planning the budget for the coming years, and in development of different government programs. International rating agencies were mentioning about the dependence of Kazakhstan's ratings on the oil of this field. This is not surprising because Kashagan is one of the largest oil and gas fields in the world, and it promises to bring large incomes to Kazakhstan's budget. Now, when the production of oil and gas at the field has been launched, it seemed that all problems are now over. But only at first glance everything seemed like this. According to experts' assessment all equipments at Kashagan are obsolete and require replacement. All these equipments were installed and launched with the expectation that the first oil at Kashagan field will be obtained in 2005-2008. But since then the date of launching of oil production at the field has been repeatedly postponed. On the eve a source in the oil and gas circles told Trend that even if in case of lack of problems in the work of these equipments, the production of oil at Kashagan will be suspended after half a year for major repairs. However, there are concerns that the equipment will require repairs even earlier. In late August a serious accident occurred at 'Bolashak' plant for complex preparation of oil and gas at the field. The sensors detected leakage of liquefied gas under high pressure. According to specialists, if there was Kahagan oil saturated with hydrogen in the factory lines at the time of the accident, the consequences would have been much more serious. That is, the recurrence of similar accidents after the start of production should not be allowed. And it is necessary to take precautionary measures right now. In addition, it was repeatedly told that the Kashagan field is one of the most complex fields in the world. According to the ratings of CNN Money, it is the most expensive energy project in the world. It has already been invested far more than it was originally planned. But no one "cancelled" the complexity of the field even after the start of oil production. Huge funds will be required in the course of its operation as well, especially in winter, when the waters of the northern Caspian Sea, where the Kashagan located, will be covered with ice. Therefore, it is unlikely to expect significant income from the field in the coming years. Certainly, the beginning of the trial production of oil in Kashagan is a great breakthrough and indicator of tremendous work carried out in the field. However, would this production have started now, if Kazakhstan had not set a deadline for the start of the field on October 1 is a big question. According to the agreement, if the consortium of shareholders of the project had launched the oil production before that date, then it would have been penalized. The same idea is suggested by the fact that only one well was reactivated, while, initially it was planned to get the oil from five wells. Thus, this is hardly the happy end in the fate of Kashagan. Most likely, this is just next step in its complex and long history. Do you have any feedback? Contact our journalist at agency@trend.az