Caspian Pipeline Consortium (CPC) is the operator of the 1511 km Tengiz-Novorossiysk pipeline system which delivers crude oil from the Caspian fields of Kazakhstan and Russia to its own Marine Terminal in Yuzhnaya Ozereevka village near Novorossiysk. Over one and a half decades of its operation, the CPC oil pipeline has become one of the most important international investment projects for transportation of energy resources with Russia participation, being the most reliable and the shortest route for Caspian oil to reach world markets. It is very indicative that CPC currently moves two thirds of all export crude oil of Kazakhstan.
What is CPC today, how important is the Company-implemented Expansion Project for crude oil output increase in the region, what tasks the Consortium staff faces, these were the questions FinEc Agency addressed to CPC General Director Nikolay Gorban.
- In 2016 Caspian Pipeline Consortium marks the 15th anniversary of the first oil tanker loading at the Marine Terminal near Novorossiysk. What ground has the Consortium covered over these years? What are its performance indicators to meet the anniversary?
- Indeed, 15 years ago – on 13 October 2001 the CPC Marine Terminal near Novorossiysk loaded the first oil tanker, Year by year the amount of crude oil injected in the Tengiz-Novorossiysk pipeline increased and by the middle of 2004 CPC reached full throughput of the first development stage – 28.2 MTA. Since 2005 CPC, using DRA, raised gradually the volume of transportation to achieve 35 MTA in 2010.
Currently, with the commissioning of the CPC Expansion Project additional facilities, the oil pipeline throughput has reached 52 MTA. In 2015, almost 43 MTA were moved via the oil pipeline, out of which 38 MTA – crude oil of Kazakhstan shippers and about 5 MTA – Russian crude oil. Last year, more than 400 oil tankers sailed from the Marine Terminal. In 2016, we expect a new shipping record of 500 oil tankers.
- What is the Expansion Project? What will be the capacity of the CPC pipeline system upon completion of all work?
- The initial construction project already provided for further development of the trunk oil pipeline. The Expansion Project has three implementation phases to reach the design capacity of 67 MTA and, with DRA, - up to 76 MTA. The unique feature of the CPC Expansion Project is that its capacity is more than doubled without pipeline shutdown. Stage-wise rise of the operating pipeline throughput is achieved by construction of new facilities and application of new technologies. By now, 19 facilities have been put into operation, 16 of them within Russia and 3 in Kazakhstan. 88 km of the pipeline were replaced with a larger diameter pipe, five oil pump stations were upgraded, construction of 10 new PSs and increase of the Marine Terminal tank capacity up to one million tons are nearing completion.
The Consortium expects to reach the full design capacity in the second half of 2017. In Russia, by the beginning of the next year it is scheduled to fully complete the comprehensive tests and ensure readiness for commissioning of the following oil pump stations: А-PS-4А and А-PS-5А (Astrakhan Region), PS-2 (Republic of Kalmykia), PS-5 (Stavropol Krai), PS-8 (Krasnodar Krai). In Kazakhstan, construction of two oil pump stations is nearing completion: А-PS-4 will be commissioned in November 2016, as regards А-PS-3А, its comprehensive testing is scheduled for December 2016 that will allow the station commissioning in the first half of 2017.
- CPC is a major international company comprising 11 shareholders – Transneft, KazMunaiGaz, LUKOIL, Chevron, Shell, ExxonMobil, Eni and others. How consolidated are their efforts to reach the common goal?
- All performance results of the Consortium, I have mentioned above, are obtained through joint efforts of the Shareholders, Management and staff of the Consortium. We study carefully and adopt the best experience of our partners throughout the world, use innovation technologies. In particular, CPC applies the best international HSE practices, while strictly complying with the Russian legislation. We hold annual Safety Days and not only for our operation personnel, but for contractors as well. For example, in August 2016 such Safety Day took place in Astrakhan.
The Consortium has achieved substantial success in environmental safety. Suffice it to say, that despite major increase of crude oil movement via the pipeline, specific environmental payments keep going down.
- It is clear that the oil pipeline capacity increase means new jobs and extra tax receipts to the state and regional budgets of Russia and Kazakhstan. What other effects does the Consortium have upon the social/economic development of the regions?
- From the first day of its existence, CPC both, in Russia and Kazakhstan, implements consistently major social programs aimed at the development of public health, education, culture, sports and other spheres. So, the total allocations under the Expansion Project within Russia are over RUR 1.5 billion, in Kazakhstan – over KZT 3.7 billion. All in all, throughout the years of its charity activities, the Consortium has invested more than RUR 2.5 in the development of the Russian regions and about KZT 3.4 – in Kazakhstan.
We believe that a high level of social responsibility is an integral feature of present-day business and every enterprise must make its contribution to improve the life of people in the area of its operations.
Pavel Kretov
FinEc Agency