CPC receives Kazakh approval

Nov 03, 1998 01:00 AM

The Caspian Pipeline Consortium (CPC) has received final approval of its Modernisation Feasibility Study from the Kazakhstan government and has received official assurances of an imminent green light from the Russian government for its final approval.
"These approvals will allow the CPC to launch an aggressive construction schedule, awarding contracts for pipe, other major equipment and the main construction effort during the next four or five months," said Richard Matzke, president of Chevron Overseas Petroleum.
Scheduled completion of the pipeline is in early 2001, with first oil expected in mid 2001. Initial capacity will be about 600,000 bpd. Ultimate capacity will be about 1.5 million bpd, which can be achieved by adding more pumping stations to the line and additional marine loading facilities.

"We are extremely pleased with the Kazakh government's approvals," said Matzke. "And we're very pleased with the support the CPC has received from both the Russian and Kazakh governments," he added. "The strong relationships and deep knowledge of the consortium partner LUKoil and CPC's General Director, V. Fedotov, have been key factors in moving this project forward."

Chevron holds 15 % interest in the $ 2.2 billion pipeline consortium and also operates the Tengiz field, which will be the principal source of oil to the CPC's 1,500 km line from Tengiz to the Black Sea port of Novorossiysk.
The Tengizchevroil joint venture produced 30,000 bpd when it began in 1993 and now averages more than 200,000 bpd. Tengiz is expected to produce 700,000 bpd in the year 2010.

"The local economies will benefit from orders for equipment by domestic industries and by local contractors. The CPC is a model of successful international co-operation and a demonstration of the confidence the Western business community has to invest in Russia and Kazakhstan," Matzke added. "Furthermore, the project will be a model from the technical, safety and environmental point of view."

The CPC was founded in 1992. Equity interest is: Russia, 24 %; Kazakhstan, 19 %; Oman, 7 %; Chevron, 15 %; LUKArco, 12.5 %; Rosneft-Shell, 7.5 %; Mobil, 7.5 %; Agip, 2 %; British Gas, 2 %; Kazakhstan Pipeline Ventures, 1.75 %; Oryx, 1.75 %.

Source: not available
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