KazMunayGas in Talks to Resume Oil Exports via BTC Pipeline, Minister Says

The national company KazMunayGas is negotiating with Azerbaijan on resuming shipments of Kazakh oil through the Baku–Tbilisi–Ceyhan pipeline, Energy Minister Yerlan Akenzhenov said, Orda.kz reports.

During a press briefing at Aqorda, the minister was asked about the current stage of work to restore exports via the BTC route. Akenzhenov noted that no official statements had yet been made by the pipeline operator, but talks were underway. 

He added that he himself learned about the suspension of shipments from media reports.

I know that KazMunayGas is currently negotiating the earliest possible resumption of deliveries along this route. As for plans, we need to make calculations here. In general, the throughput capacity of this pipeline is very large. It currently pumps 25 million tons of oil, but its capacity is 50 million tons. So, there is always the possibility of fulfilling the plan, the capacity allows it,  said Akkenzhenov.

The Ministry of Energy had earlier indicated that it hoped to increase supplies from Tengiz and Kashagan through the BTC. This is one of the key alternative export routes Kazakhstan can use to bypass Russia.

Last year, the ministry outlined ambitious targets for boosting shipments via Baku. But the actual agreements reached between KazMunayGas and Azerbaijan’s state oil company SOCAR turned out to be more modest.

The reason is that Kazakh crude is of lower quality compared to Azerbaijan’s Azeri Light, meaning the pipeline can only accept a limited amount of oil from Tengiz and Kashagan.

In mid-August, Kazakhstan was forced to temporarily halt oil exports through Baku and redirect flows to the Caspian Pipeline Consortium. The disruption was caused by contamination of BTC storage tanks with chlorides, which sharply reduced the quality and price of Azeri crude.

Later, it was confirmed that Kazakhstan was not responsible for the incident, as no organic chlorine compounds were found in oil from Tengiz and Kashagan.

Original Author: Nikita Drobny