Volume 2, issue #16 - 05-06-1997

sponsored by:

Chevron partners in Caspian Pipeline Consortium

May 16, 1997 Chevron has acquired a 15 % ownership in the restructured Caspian Pipeline Consortium (CPC). Completion of the consortium's restructuring agreement was recently celebrated in Moscow.
The Tengizchevroil (TCO) joint venture, in which Chevron has a 45 % interest, will be the principal shipper for the 900-mile (1,500-km) crude oil pipeline to be constructed from the Tengiz oil field in western Kazakhstan to the Russian Black Sea coast.
This transfer of ownership follows the Dec. 6, 1996, signing in Moscow of the agreement restructuring CPC to include private oil companies in the pipeline project.
Upon completion of the $ 2 bn construction project, scheduled for year-end 1999, the pipeline will commence export operations. With upgrades, CPC will ultimately allow the export of 67 million tonnes per year or 1.5 mm bpd from the region.
As the largest oil company shareholder in CPC, Chevron will be able to fully develop Tengiz for the TCO joint venture to reach peak production of 700,000 bpd, expected by 2015.
The acquisition finalises the transfer of interests in CPC from its founding members Russia, Kazakhstan, and Oman to the oil companies who will be financing the project. The owners and their equity interests are: the governments of Russia (24 %), Kazakhstan (19 %) and Oman (7 %), as well as Chevron (15 %), LukArco (12.5 %), Rosneft-Shell (7.5 %), Mobil (7.5 %), Agip (2 %), British Gas (2 %), a joint venture between Amoco and the new national company Kazakoil (1.75 %), and Oryx (1.75 %).