Page 6 - FSUOGM Week 32 2021
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FSUOGM PERFORMANCE FSUOGM
KMG suffers further output declines in H1 2021
KAZAKHSTAN
The NOC also reported declines of between 4% and 9% at the country's three biggest oil projects.
KAZAKHSTAN’S national oil company (NOC) KazMunayGas (KMG) suffered a further dip in its output in the first half of the year, with the decline spread across its three main oil-produc- ing subsidiaries.
KMG produced 10.74mn tonnes (435,000 barrels per day) of oil during the six-month period, down 5.3% year on year. Its gas output fell 5.6% to 4.08bn cubic metres (bcm).
The company’s largest production unit, Ozen- munaygaz, reined in supply by more than 4% to around 106,000 bpd, while Mangistaumunaigaz and Embamunaygas similarly reported declines of over 5% and 10% respectively. All three run mostly mature fields reaching depletion in west- ern Kazakhstan, where hundreds of wells were turned off last year in response to the price col- lapse and Kazakhstan’s OPEC+ commitments.
KMG acknowledged that production costs at Ozenmunaygaz were high, at around $29 per barrel.
The NOC also reported declines of between 4% and 9% at the country’s three largest oil developments – Karachaganak, Kashagan and Karachaganak. After reporting several years of output growth on the back of Kashagan’s launch in 2016, Kazakhstan was forced to make unprec- edented cuts to supply last year as part of a coor- dinated effort by OPEC+ members to rebalance the market.
Expectations are that production at Kazakh- stan’s largest oil projects should continue grow- ing in the coming years, which will mean that Karachaganak, Kashagan and Tengiz account for an even greater share of the country’s crude supply. The three fields already contribute over 60% of national production.
Tengiz is undergoing an expansion due to lift its output to 850,000 bpd or 1mn barrels of oil equivalent per day, at a cost of $45bn. But its operator Chevron warned at the end of July that completion had been delayed until mid-2024, mostly because of disruptions caused by the pandemic.
Karachaganak is also undergoing upgrades, while output at Kashagan reached 384,000 bpd in the first few days of August, according to Reu- ters, up from 334,000 bpd in July. This growth was likely the result of eased OPEC+ production cuts.
KMG noted a 2.7% growth in gas trans- portation in the first half, thanks to a 11.8% increase in supplies of Kazakh, Uzbek and Turkmen gas via the Kazakhstan-China pipeline, reflecting stronger demand for gas in China in contrast to weakness during the early stages of the pandemic. The NOC also boosted oil refining throughput by 17%, reflecting the recovery in fuel demand in the country.
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w w w . N E W S B A S E . c o m Week 32 11•August•2021
