Caspian Pipeline Consortium was established a quarter of century ago.
This year Caspian Pipeline Consortium celebrates its 25th anniversary. Nikolay Gorban, CPC General Director, tells RG about the company’s history, current day and development plans.
Mr. Gorban, what is the CPC structure and what are its goals and objectives?
Nikolay Gorban: Caspian Pipeline Consortium is an international company transporting crude oil produced in the Kazakhstani and Russian fields of the Caspian Basin. Built in early 2000, the 1,511-kilometer pipeline starts at the Tengiz field, runs through Atyrau Oblast of the Republic of Kazakhstan, then through four regions of the Russian Federation - Astrakhan Oblast, the Republic of Kalmykia, Stavropol Krai and Krasnodar Krai. The pipeline goes to the Black Sea, where at the Marine Terminal near Novorossiysk crude oil is lifted to tankers and exported to many countries all over the world. Crude oil is pumped by 15 pump stations (PS).
What companies supply crude oil to the Consortium pipeline system?
Nikolay Gorban: Today we have more than 10 shippers, including TengizChevroil, ExxonMobil, Shell, LUKOIL, etc. Some of them are “connected” to our pipeline system at different pump stations on the route. The first station along the pipeline route is called Tengiz; it receives crude from the field of the same name. At Atyrau PS, we receive the crude oil from the Kashagan and Karachaganak fields. At Komsomolskaya PS, the crude from the Filanovsky field is injected into the CPC pipeline system. Kropotkin PS also accepts hydrocarbons from Russian fields. All pump stations receiving crude have tank farms for its storage. Our largest Tank Farm with the capacity of one million tons is located at the Marine Terminal.
From what event Caspian Pipeline Consortium counts its 25th anniversary?
Nikolay Gorban: This year we celebrate 25 years since the signing of the Shareholders Agreement. This document, dated December 6, 1996, established the company as it is today. Also in 2021, it will be 20 years since the start of CPC pipeline system filling with crude from the Tengiz field, and 20 years since the first tanker loading at the CPC Marine Terminal in Novorossiysk.
What brand of crude does CPC transport and how does it rank on the international market?
Nikolay Gorban: Our brand is called CPC Blend. It is a low-sulfur light crude with an API gravity of 46.2-46.7 and a sulfur mass content of 0.54-0.56%. Crude components in the CPC Blend basket have been relatively stable over the past several years. Our oil is in demand worldwide.
What is the throughput of the CPC pipeline today and how has it changed over the company’s existence?
Nikolay Gorban: The Consortium achieved its initial design capacity of 28.2 MMTA in mid-2004. In December 2009, the CPC Expansion Project commenced. It was successfully completed in 2018, and the current capacity of our pipeline is 67 MMTA.
In May 2019, CPC started its Debottlenecking Program (DBNP). Upon its completion in 2023, the CPC pipeline throughput capacity will be increased up to 80 MMTA.
What helps to increase the pipeline throughput capacity?
Nikolay Gorban: As part of the Expansion Project, we built and commissioned new pump stations along the route, which allowed increasing the throughput. In addition, the number of single point mooring buoys (SPM), from which crude is lifted, was also increased. We are upgrading the pipeline system with variable frequency drives for pumping equipment and applying a number of other solutions under the DBNP. For example, the construction of a new LACT meter at the Marine Terminal will enable to load tankers simultaneously from three SPMs.
What is the company’s environmental policy?
Nikolay Gorban: The CPC health, safety and environment (HSE) policy prioritized the reduction of environmental impact during operation of CPC facilities. This approach was introduced at the design stage and implemented during construction, and it is still in effect in the course of operation of the oil pipeline system. Our commitment to high environmental standards is supported by rational use of natural resources, use of the most advanced technologies, competent management of operations and responsible attitude of each member of our large team.
Crude oil storage tanks with floating roofs that reduce hydrocarbon vapor fraction emissions by 90% are installed at CPC sites. For monitoring the integrity of tanks and the pipeline we use an up-to-date automatic SCADA system, which responds in fractions of a second to any change in the operation of pumping equipment. Field drills are regularly conducted at all facilities to test the readiness of equipment and personnel for emergencies.
All elements of the CPC infrastructure undergo regular industrial environmental monitoring (IEM) to check whether air and water components comply with legislative standards. IEM data is submitted to the RF Ministry of Nature, Rospotrebnadzor and is publically available on the company’s website. It should be noted that CPC has never violated environmental standards during its operation.
In addition to improving our processes, we are also implementing a number of biodiversity conservation and improvement programs in the regions of our presence. In Kazakhstan and Kalmykia, CPC takes care of the "red-book" saiga population; in Astrakhan Oblast, together with the Research Institute of Fishery, we breed sturgeon; in Stavropol, we increase the population of sika and red deer. Our program “Let’s Save Our Country’s Environment” is targeted not only to protect flora and fauna but also it sets environmental awareness goals by engaging the younger generation in eco-projects.
What other social projects does CPC implement in the regions where it operates?
Nikolay Gorban: CPC supports medicine, education, culture, and children's sports. We build and equip kindergartens, schools, hospitals, cultural and educational centers with modern equipment. We allocate funds for new vehicles - school and city buses, ambulances. Every year we give presents as part of the campaigns "CPC to First-Graders", "CPC to Veterans", and "New Year and Christmas Holidays together with CPC".
How did last year's COVID-19 outbreak adjust CPC operations?
Nikolay Gorban: Our company's business profile is oil transportation, and transportation volumes in the "coronavirus" year of 2020 predictably decreased as in all similar companies. Our decline was not very great, about 7%, and the main reason was OPEC+ restrictions, which caused our shippers to cut production. It is well known, that the demand for crude oil has declined worldwide for obvious reasons: there is much less transportation. However, there was no downtime in CPC; the pipeline was only shut down for scheduled maintenance.
Have the on-site working conditions changed? Four regions in Russia and one region in Kazakhstan - each of them had different dynamics of virus spread, is it so?
Nikolay Gorban: In each republic, oblast, krai, the work of CPC facilities was built in accordance with real morbidity statistics and relevant requirements established by local authorities and medicine. Our pump stations were switched from shift to rotation mode depending on the situation, personnel were moved to remote work, observation measures were taken, examinations and vaccinations were carried out. Due to a set of measures taken in a timely manner we managed to work both continuously and safely.
What plans does CPC have for 2021 and the medium term?
Nikolay Gorban: This year we are ready to transport crude at the pipeline maximum throughput capacity of 67.5 million tons. It's up to our shippers to fill the "pipe" to such an extent. At the same time, the DBNP construction phase has started: in March, contractors started working at CPC pump stations and Marine Terminal.
If our "transportation" results for the anniversary year look like 705 million tons of crude transported and 6,647 tankers lifted, the industrial safety achievements are more than 27 million hours without recordable injuries and accidents and about 80 million kilometers driven without recordable MVA. For the past three years, the company has demonstrated zero injury rate due to effective measures taken to achieve this goal, including the introduction of Safe Work Culture, promotion of safety awareness and CPC Life Saving Rules. We are doing our best to provide and maintain the most comfortable and safe working conditions, realizing that people are the company’s core asset.
Mikhail Nesterov
Rossiyskaya Gazeta, 26 April 2021