Kazakhstani shelf: a new center of global oil and gas extraction

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altby Energy Focus
Kazakhstan sector of the Caspian Sea (KSCS) has the largest hydrocarbon reserves in comparison with other Caspian littoral countries.

In the foreseeable future oil extraction on the shelf will not only signifcantly increase oil production in the country, but also strengthen the position of Kazakhstan as an important supplier of hydrocarbons to world markets. So, Caspian oil of Kazakhstan for some extent will be an effective alternative for resources of politically unstable Middle East region and will help to compensate the effects of drop in production in other major oil and gas centers of the world.

Although certain works on the KSCS were conducted before the republic gained its independence, the start year of the full study and development of potential is 1993. Then there was formed the international consortium "Kazakhstancaspishelf", whose work has proved to the world community a huge hydrocarbon potential of the KSCS. For example, during the years of indepen-dence, it was revealed more than 120 prospective structures on it with forecast reserves of 8 billion tons of equivalent fuel, including 4.5 billion tons of oil. It should be noted that the area of KSCS, proceeding from the geological conditions of the subsurface structure and other terms of the development of water area, is divided into three zones, which are characterized by various oil and gas potential, the conditions of exploration and extraction of raw materials. In particular, in Zone 1 subsalt Upper Paleozoic deposits are the main ones by expected promising resources.

The big and the biggest oil and gas felds were discovered in this zone from 2000 to 2004 - Kashagan, Aktoty, Kairan, now settling down in the framework of the North Caspian project. By the way, after the opening of Prudhoe Bay feld in Alaska at the end of 1960, Kashagan is one of the largest oil felds in the world with recoverable hydrocarbon reserves of more than 10 billion barrels. In Zone 2, consisting of Kalamkas-sea, Auezov and Khazar sections, the Mesozoic complex of rocks is considered as perspective. For the current, date the industrial productivity of Middle Jurassic deposits here is confrmed. In zone 3, which includes parts of Rakushech-noye sea and Nursultan (N Block), Mesozoic complex is promising. Designated areas are also distinguished by depth of water, ice and environmental conditions. Recall that according to the plan of develop-ment of the Kashagan feld with geological  reserves of 4.85 billion tons in 2010-11 it is provided a conduction of exploration phase, as for 2012-20 years - industrial development. Exploration on Kayran will be held before 2015, on Aktoty and Kalamkas-sea -up to 2017, on Khazar - to 2018, on Auezov - until 2019. On the site of Rakushechnoye sea a search phase will be completed in 2011, on the N block - in 2011-12, and exploration here will be held respectively in 2012-19 and 2013-19 years. The exploration period will be followed by industrial exploitation of oil felds. Also in the near future, Kazakhstan will begin exploration on the Abay block, later - on the Khvalynskoye and Central blocks. However, now, on results of seismic and geological prospecting, oil and gas potential was proved on Khazar, Auezov and Rakushech-noye sea structures.

Kazakhstan has been actively developing the exploration and further production of hydrocarbons on the Caspian shelf in partnership with interested foreign investors. Now the Caspian projects are represented by such leading oil and gas companies of the world as ExxonMobil, ConocoPhillips, Shell, Total, Eni, LUKoil, ONGC and others. In recent years, foreign investors have invested to the development of offshore felds in our country tens of billions of dollars. For example, investments only to Kashagan were more than $ 33 billion, the bulk of which goes for capital investments of foreign par-ticipants of the North-Caspian project. Partnership with them has enabled the country to get considerable experience in conduction of offshore oil operations and even today to serve as a co-operator of offshore projects. At the same time, the country has all the potential for self-implementation of large offshore projects. The country has enough for fnances and resources, as well as technological capabilities. In the future this tendency will only intensify. Accordingly, a strategy for future cooperation in the implementation of projects in the KSCS is being formed: it must be based on equal partnership, with the gradual strengthening of the role of Kazakhstan.

Production potential. The Kashagan, Kai-ran and Aktoty felds have the bulk of the total hydrocarbon production from KSCS in the longer term.

In 2012 it is planned to produce 568 thousand tons of oil and gas condensate in total for KSCS, in 2013 – 9 124 tons, in 2014 - 13 237 thousand tons, in 2015 - 14 900 thousand tons, in 2016 - 28 930 tons, in 2020 -65 225 tons. Until 2017 inclusive, the entire volume of oil production will occur in zone 1, while in 2018 - 41 870 thousand tons, and in 2020 - 61 877 thousand m. In this case prior to 2015 will remain the sole Kashagan oil feld operated in the Caspian Sea, in 2016 it will produce 28 million tons of crude oil in 2020 - 59.5 million tons. Should be reminded that the total oil pro-duction in Kazakhstan in 2020 is projected to reach 130 million tons - in fact, on the Caspian shelf will be produced half of Ka-zakhstani hydrocarbons. It should be noted that the shelf production is of different technological complexity and high capital intensity. All the more so, the works on the Caspian Sea are complicated by a combination of negative factors such as increased sensitivity of the environment, shallow water, high reservoir pressure, a signifcant sulfur content in the produced raw materials.

That is why Kazakhstan is interested in ac-cess to the most modern, cutting-edge technologies and methods of offshore exploration and production, which will improve the ef-fectiveness of all types of work in the long term perspective.
Therefore, the republic pays great attention to the introduction of new technologies to the geological exploration, drilling, offshore felds’ arrangement. And international experience shows that intensive use of high effective technologies such as horizontal drilling, enhanced oil recovery techniques, three-dimensional seismic surveys under conditions of development of the "expensive" hydrocarbons allows to signifcantly reduce the costs associated with their exploration and production.
The creation of an infrastructure to support offshore operations is directly related with the terms and rates of development of structures and felds of KSCS. In 2020 only at the Kashagan feld 18 islands of drilling and production will be built, 3 of which will be built in 2012 as a part of Phase 1 of development of this feld. There are already built 17 major coastal infra-structure facilities on the coast of the Cas-pian Sea, including 10 - in Bautino. Also, the "KazMunaiGas" company in 2011 started to implement a project of building the North-Caspian environmental base on oil spill response, which will ensure the environmental safety of oil production and transportation of produced raw materials. The capacity expansion of the Caspian Pipeline Consortium can be considered as one of the key infrastructure projects for KSCS (CPC), which began this summer. Already by the frst quarter of 2015 its capacity will be increased from 28 to 67 million tons, 52.2 million tons of which will fall on Kazakhstan's quota. As a consequence, the CTC will be a major export destination for oil extracted from Kazakhstan's offshore felds. In the future, during the 2018-19 period, it is scheduled to begin the construction of the Kazakhstan Caspian oil Transportation System (KCTS), including Yeskene-Kuryk pipeline. KCTS will provide transportation of 25 million tons of oil per year at an early stage through the Baku-Tbilisi-Ceyhan pipeline to the world markets, with a subsequent in-creasing to 56 million tons.