EIA predicts long term oil production growth in Kazakhstan

Baku, Azerbaijan, Sept. 11

By Elena Kosolapova - Trend: Kazakhstan will increase petroleum and other liquids production to 2.1 million barrels per day in 2020 compared to 1.6 million barrels per day in 2010 and 2011 based on reference case, the U.S. Energy Information Administration's (EIA) International Energy Outlook 2014 predicts.

Petroleum and other liquids production in Kazakhstan will reach 2.9 million barrels per day in 2025, 3.1 million barrels per day in 2030, 3.2 million barrels per day in 2035 and 3.5 million barrels per day in 2014, according to EIA forecast.

The average annual change in petroleum and other liquids production in reference case will hit 2.5 percent in Kazakhstan in 2010-2040.

In the reference case, crude and lease condensate production is forecasted to rise from 1.6 million barrels per day in 2010 and 2011 to 1.9 million barrels per day in 2020, 2.7 million barrels per day in 2025, 2.8 million barrels per day in 2030, 2.9 million barrels per day in 2035 and 3.1 million barrels per day in 2040. Thus, average annual change in crude and lease condensate production will hit 2.3 percent in 2010-2040.

Crude and lease condensate includes tight oil, shale oil, extra-heavy oil, field condensate and bitumen.

Meanwhile, in case of low oil prices, petroleum and other liquids production in Kazakhstan will reach 1.9 million barrels per day in 2020, 2.4 million barrels per day in 2025, 2.6 million barrels per day in 2030, 2.8 million barrels per day in 2035 and 3.1 million barrels per day in 2040, the outlook says.

Thus, in case of low oil prices, average annual change in petroleum and other liquids production in Kazakhstan will hit 2.2 percent in 2010-2040, EIA said.

In case of low oil prices, crude and lease condensate production in Kazakhstan is forecasted to rise from 1.6 million barrels per day in 2010 and 2011 to 1.8 million barrels per day in 2020, 2.2 million barrels per day in 2025, 2.3 million barrels per day in 2030, 2.5 million barrels per day in 2035 and 2.6 million barrels per day in 2040. Average annual change in crude and lease condensate production will hit 1.8 percent in 2010- 2040 in case of low oil prices.

In case of high oil prices, petroleum and other liquids production in Kazakhstan will reach 2.3 million barrels per day in 2020, 2.9 million barrels per day in 2025, 3.5 million barrels per day in 2030, 4 million barrels per day in 2035 and 4.6 million barrels per day in 2040, EIA predicts.

Average annual change in petroleum and other liquid production will hit 3.5 percent in 2010- 2040 in this case.

Crude and lease condensate production will increase to 2.2 million barrels per day in 2020, 2.7 million barrels per day in 2025, 3.2 million barrels per day in 2030, 3.7 million barrels per day in 2035 and 4.1 million barrels per day in 2040 in case of high oil prices.
Average annual change in crude and lease condensate production will hit 3.3 percent in this case.

While Kazakhstan is one of the largest sources of additional non-OPEC crude oil production in EIA's projection, the size of the increase has been lowered since the International Energy Outlook
2013 was published.

Performance has been disappointing at the supergiant offshore Kashagan field, where the project took more than a decade to bring production online (in September 2013) only to have it shut in soon after it started because of a gas leak. Kazakhstan's Minister of Oil and Gas announced in April 2014 that production at Kashagan may not resume before the end of the year. Despite substantial foreign investment, the difficulties of working in the offshore Caspian terrain have tempered prospects for growth.

Outside of Kashagan, Kazakhstan has three other major onshore fields-Tengiz, Uzen, and Karachaganak-in the western part of the country.

Petroleum production from Tengiz alone doubled between 2004 and 2008, reaching 0.54 million barrels per day in September 2008 when its full expansion was completed. Although crude oil and lease condensate production at Tengiz has declined somewhat since 2008, to 0.47 million barrels per day in 2012, the Tengizchevriol consortium (led by Chevron) expects to increase petroleum production further, to as much as 1 million barrels per day. Uzen and Karachaganak have smaller reserves than Tengiz but are expected to contribute to an increase in crude and lease condensate production in the next several years.

Edited by C.N.