A CPC-R Board meeting and a CPC-K extraordinary general shareholder meeting were held in Moscow on 12 February.
All agenda items were approved unanimously.
One of the key matters approved by the CPC-R and CPC-K governance bodies was a fundamental issue of starting an early repayment of the Shareholder debt subject to having sufficient funds available to complete activities under the CPC pipeline expansion project.
The Shareholders heard an Expansion project progress update by William Simpson, CPC-R Deputy General Director for Projects & Engineering. This year CPC plans to commission 15 facilities, 9 of which are brand new. All Expansion construction and installation activities are to be mechanically complete by the end of 2015. The construction is currently on schedule.
Dennis Fahy, First Deputy General Director for Operations, reported on starting the oil-in at completed sites, including a new pump station in the Iki-Burul District in Kalmykia (PS-3) and the upgraded Atyrau PS. This is done in order to do the integrated testing of these facilities.
The meeting was closed with a CPC Management HSE report.
CPC pipeline system is one of the largest investment projects in the energy industry with participation of foreign capital on the CIS territory. The length of the pipeline connecting the oil fields in Western Kazakhstan with the Marine Terminal near Novorossiysk is 1,511 km. CPC Marine Terminal is equipped with single point moorings which allow for safe tanker lifting at a considerable distance from the shore, also when the weather conditions are unfavorable.
The Expansion Project includes rehabilitation of 5 existing and construction of 10 additional pump stations (2 in the Republic of Kazakhstan and 8 in the Russian Federation), six new storage tanks (100,000 cu.m each) in addition to the existing four near Novorossiysk and a third SPM at the CPC Marine Terminal, and also the replacement of an 88 km pipeline section in Kazakhstan with a larger diameter pipe. The total amount of the Project investments will be US$ 5.4 billion.
CPC Shareholders: Russian Federation (represented by Transneft – 24% and CPC Company – 7 %) – 31%; Republic of Kazakhstan (represented by KazMunayGaz – 19% and Kazakhstan Pipeline Ventures LLC – 1.75%) – 20.75%; Chevron Caspian Pipeline Consortium Company - 15%, LUKARCO B.V. – 12.5%, Mobil Caspian Pipeline Company – 7.5%, Rosneft-Shell Caspian Ventures Limited – 7.5%, BG Overseas Holding Limited - 2%, Eni International N.A. N.V. - 2% и Oryx Caspian Pipeline LLC – 1.75%.