CPC guarantees efficient and environmentally safe movement of crude oil

The Project is designed to increase the trunk pipeline capacity

CPC Executed Agreements with Russian Regions on Implementation of Social Programs under the Expansion Project

​Within the framework of the 10th International Investment Forum «Sochi 2011» held on September 15-18, Caspian Pipeline Consortium’s General Director Nikolay Platonov had meetings with heads of the regions traversed by the CPC pipeline. Talks were held with Stavropol Krai Governor Valery Gaevsky, Astrakhan Oblast Governor Alexander Zhilkin, Krasnodar Krai Vice Governor Vadim Lukoyanov and Novorossiysk City Head Vladimir Sinyagovsky.

The main discussion subject-matters related to implementation of the CPC Pipeline Expansion Project, construction work under which began last July. The region heads and mayor of Novorossiysk emphasized the social and economic importance of the multibillion investments made by the international consortium for construction of various facilities in Russia to increase the capacity of this trans-border trunk pipeline. The regional authorities confirmed their commitment to the previous obligations assumed under the cooperation agreements signed with the consortium in 2010: assist the company with documenting its land rights, obtaining expert opinions, approvals and permits, commissioning of new facilities, and provide information support to the company.

In the course of the meetings with Krasnodar Krai Administration, Stavropol Krai Government and Novorossiysk City Administration Head, some additional cooperation agreements were signed to provide for funding by the consortium of educational and healthcare facility construction projects in the regions of modernization and new pump station construction, and also in Novorossiysk where the CPC marine terminal will be expanded. Previously, a similar agreement was executed between Caspian Pipeline Consortium and Astrakhan Oblast. For these purposes, the company will allocate over 1 billion rubles to the Russian regions.

«I am happy that we had the opportunity at this high economy forum to hold the meetings with the heads of the most important regions traversed by the consortium’s pipeline. We have “synchronized our watches” once again and discussed current matters of the launched CPC Expansion Project which is both internationally important and designed to make a weighty contribution to the social and economic development of the southern Russian regions. We mean here the multiplier effect of the investments for the regional and local businesses, creation of new permanent and temporary jobs for local residents, benefits for the budgets of all levels and enhancement of the geo-economic role played by the regions traversed by our strategic through-passage. However, our consortium’s understanding of its social responsibility is much wider. Just today we assumed obligations on construction of infrastructural educational and healthcare facilities in the regions of the expansion project implementation to the total amount of about 0.5 billion rubles. I am sure that the schools, kindergartens and healthcare facilities constructed or reconstructed in a timely manner and at a high quality level at the areas of construction and modernization of CPC pump stations and marine terminal will serve true to the local residents for decades and promote reaching of the social objectives set forth in our country», said CPC General Director Nikolay Platonov after signing the agreements.

The CPC pipeline system is the largest oil movement route for crude oil from the Caspian Region to reach international markets. This mainline pipeline, 1,511 km in total length, connects Western Kazakhstan fields with the Russian Black Sea coast. Russian oil is injected into the pipeline system at Kropotkin PS in Krasnodar Krai. CPC’s marine terminal is equipped with single point moorings that allow to load tankers safely at a significant distance offshore, including bad weather conditions.

The Expansion provides for the CPC pipeline system capacity increase to 67 MMTA. The Expansion Project includes rehabilitation of the existing, and construction of 10 additional pump stations (2 in the Republic of Kazakhstan and 8 in the Russian Federation), six crude oil storage tanks near Novorossiysk, as well as third single point mooring at the CPC Marine Terminal and replacement of 88 km of pipelines in Kazakhstan with a larger diameter pipe. The total amount of investments in the project will be USD 5.4 billion. It is planned to complete the project in 2015.

CPC Shareholders: Russian Federation (represented by Transneft – 24% and CPC Company – 7%) – 31%; Republic of Kazakhstan (represented by KazMunaiGaz – 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%; and Oryx Caspian Pipeline LLC – 1.75%.