Page 14 - FSUOGM Week 23 2022

FSUOGM PROJECTS & COMPANIES FSUOGM

Kazakhstan-focused Caspian Sunrise

weighs up impact of Russia sanctions

KAZAKHSTAN LONDON-LISTED Caspian Sunrise is incur- “the natural market arbitrage takes effect.”
ring a significant loss in revenue because its oil “We expect the buyers who have not signed
Caspian Sunrise is termed Russian Urals Oil, even though it is up to boycott Russian oil, including China, India
says it is suffering produced in west Kazakhstan, the company said and other large Asian economies, to take advan-
because buyers don't on June 6. tage of the current discount for Urals Oil and
differentiate between Recently Urals has been trading at a $30-35 switch their buying to this cheaper oil and reduce
Kazakh and Russian per barrel discount to Brent. As a large share of the oil they buy from other more expensive
crude. Kazakh oil flows through Russia on its way to sources,” Caspian Sunrise said. “In summary, we
market, and as it is similar in quality to Russian do not expect the current large discounts contin-
crude, it has historically shared the same name. uing at current levels going forward. Renaming
Kazakhstan’s government is expected to Kazakh produced oil will also help differentiate
shortly rename its oil KEBCO in order to dif- it from Russian oil.”
ferentiate it from Urals. The move should mean In an operations update, Caspian Sunrise said
Kazakh exporters fetch a higher price for their it had spudded the Deep Well 802 at BNG. This is
product, as well as eliminate cases where Kazakh the second deep well to be drilled on the Yelemes
oil has been shunned because it is misidentified Deep structure and the sixth deep well in total to
as Russian, either due to sanctions or self-sanc- be drilled at BNG. Deep Well 802 will have a total
tioning by buyers. depth of 5,200 metres, targeting oil in the easi-
“To date … we have no problems in access- er-to-drill Sandstone rather than Carboniferous
ing the Russian pipeline network to deliver our rock, Caspian Sunrise said. The well is expected
international oil and we do not believe there will to take four months to complete.
be any issues in this respect, no matter how long “By using our own rig, with the casing already
sanctions continue,” Caspian Sunrise said in a acquired and by drilling through the easier
stock exchange filing. “Whatever happens, we sandstone, the cash costs are expected to be sig-
do not see these pipelines being closed.” nificantly lower than for previous deep wells,”
Caspian Sunrise’s oil typically flows from the Caspian Sunrise said. “The well is being drilled
company’s flagship BNG asset in west Kazakh- close to the site of a Soviet era blowout and our
stan to Russia’s Baltic coast, where it is loaded advisers have provided us with the highest esti-
onto tankers for market, the company said, add- mate of success for any of our BNG deep wells
ing that Urals’ discount was likely to reduce as drilled to date." ™

P14 www. NEWSBASE .com Week 23 08•June•2022