Kashagan Partners to QazaqGas - Focus On Construction

Kashagan has not confirmed the projections of the national company QazaqGaz. They concern the construction of the new gas processing plant that would facilitate an increase in oil production. The NCOC concern said that QazaqGaz should "focus on its own role in construction," Orda.kz reports.

As S&P Global writes, NCOC commented on the statements made by QazaqGaz general director Sanzhar Zharkeshov. 

At the end of September, he announced a possible increase in oil production by 25 thousand barrels per day thanks to each additional billion cubic meters of gas processing per year. The national company expects to increase oil production at Kashagan from 400 thousand to 500 thousand barrels daily.

NCOC responded that it "continues to study the possibilities" of expanding production at Kashagan.

NCOC has stated that QazaqGaz would be better off focusing on its role in oil and gas projects at Kashagan, which are still far from complete.

S&P Global reports that the Kashagan oil production expansion project is progressing slowly, mired in controversy over alleged environmental violations. The gas processing plant construction, for which QazaqGaz is responsible, was only 23% complete by early August, and its completion date was pushed back from early 2025 to mid-2026. Both Sanzhar Zharkeshov's comments and NCOC's rebuff reflect overall dissatisfaction.

Meanwhile, Kazakhstan's authorities continue a sluggish arbitration with foreign investors in Kashagan.

Energy Minister Almasadam Satkaliyev said in September that Kazakhstan hoped to reach a preliminary decision on these proceedings in the second half of 2024. Such a decision may involve concessions from Kazakhstan's authorities, including revising environmental legislation to benefit NCOC.

Original Author: Nikita Drobny