Tengizchevroil (TCO), the Chevron-led oil venture in Kazakhstan, is considering borrowing on capital markets to help finance a planned $18.5 billion expansion project, Kazakh state oil and gas firm KazMunaiGas said.
KazMunaiGas (KMG) holds 20 percent in TCO, where Chevron holds 50 percent, ExxonMobil 25 percent and Russia's LUKOIL 5 percent.
"At this (expansion) stage TCO plans building an oil processing plant with an annual capacity of 12 million tonnes of oil per year," KMG said in a written response to Reuters questions.
"The first oil (at this stage) is forecast to flow in 2018. After the implementation of the project, the consolidated volume of oil output at the Tengiz and Korolyovskoye fields will total 37 million tonnes to 40 million tonnes per year."
Last year TCO increased output by 15 percent to 25.9 million tonnes, cementing its position as the largest oil producer in Kazakhstan.
Kazakhstan, Central Asia's largest economy, is the second-largest crude producer in the former Soviet Union after Russia.
Kazakhstan plans to produce 80.4 million tonnes of oil in 2011, which would increase to 132.1 million tonnes by 2020.
The start-up of the Kashagan field in the Caspian Sea, run by another international consortium, North Caspian Operating Company (NCOC), will be the main driver of the forecast growth.
KMG, which owns 16.81 percent in NCOC, said it also did not rule out borrowing to finance its share in the development of the giant field.
"The project of Kashagan's development is financed with the company's own funds, but in the future, if there is a lack of own funds, the project will be financed with borrowed capital," KMG said.
"The current oil price on international markets allows KMG to fund independently a number of large investment projects, including the North Caspian project."
Commercial production at the first phase of Kashagan is scheduled to begin by the end of 2012 or early 2013.
KazMunaiGas plans to boost its crude output to 33.7 million tonnes by 2020 from this year's forecast of 22.1 million tonnes, the company said this week.
The company also said it was looking for business opportunities in Russia and Turkmenistan, and was seeking assets in Iraq, Iran and North Africa.