Kazakhstan Interest in Oil Refining Construction in Turkish Ceyhan Port

Oil&Gas Materials 11 August 2008 17:02 (UTC +04:00)

Kazakhstan, Astana, 11 August / Trend  corr. K.Konirova / Kazakhstan continues to show interest in the project to construct the oil refining in the Turkish's Ceyhan port, a source from the national company KazMunayGaz reported a special correspondent of Trend in Astana.

National company continues to show interest in the project. At present, the construction works on the area have been suspended because of the company studies the issue to purchase oil refining assets abroad. The issue is to purchase assets from the Romanian company Rompetrol.

According to the source, the issue to unite KazMunayGaz with the State Oil Company of Azerbaijan (SOCAR) to construct the oil refining in Ceyhan had been discussed before.

"SOCAR has invited KazMunayGaz to join the project, and we held talks with Azerbaijani colleagues. However, SOCAR's position was tough: KazMunayGaz to participate only in talks with SOCAR partners, the source said. Project's cost has risen because of increase in steel price.

The capacity of the new oil refining in Ceyhan port is 15mln tons. Before, the project's cost touched $5bln. Project's participants were KazMunayGaz, Indian Oil India, Turkish Calik Enerji and Italian Eni companies.

According to the specialists, the most 'profitable' economy is laid in Ceyhan. First, the Ceyhan port has a good location. At present, oil is delivered to the Ceyhan port through the Baku - Tbilisi - Ceyhan pipeline which projected capacity makes 50mln tons per year. The Turkish Government plans to construct one more route of Samsun-Ceyhan over the territory of the country with the projected capacity of 50mln tons a year. Moreover, it is not excluded that oil will be delivered to Turkey from Iran through the Kirkuk - Ceyhan pipeline with the capacity of 70mln tons a year. In future a total of three important arteries will meet in the Ceyhan port region and they will totally bring about 170mln tons of oil there. This figure is more than in Rotterdam, the largest port of the world, which receives about 150mln tons of oil.    

Second, the Ceyhan port is located in the most beneficial territory for such business: the weather is sunny and without wind in 365 days of year here.

Third is the presence of prospective market. First of all, it is Turkey. At present, the country is experiencing a deficit of oil refinery capacities. Thus, currently, five plants produce only 26.5mln tons of oil product and the country supply the rest 6-7mln purchasing from Russia and Italy. However, in accordance with the specialists' forecasts, Turkey's appetite or oil products will rise to 34mln tons in 2010 and to 43mln tons in 2012

Turkey is interested in the construction of new Oil Refinery Plants (ORP), because of the market's needs. A total of 10 of 15mln tons of oil, which will be produced at a new plant, will be realized in the Turkish market and the rest 5mln in India.

Construction of the ORP in Ceyhan is planned to complete in 2012. A large spectrum of oil products, including all kinds of high-octane petrol, black oil, diesel fuel, aviation kerosene and petrochemical products will be produced at this plant.

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