CPC guarantees efficient and environmentally safe movement of crude oil

The Project is designed to increase the trunk pipeline capacity

Meeting of CPC and KTO Top Management

2018-08-06-2.JPGA meeting of Caspian Pipeline Consortium and KazTransOil Heads was held in Atyrau on August 6, 2018. CPC was represented at the meeting by CPC General Director Nikolay Gorban, Vladimir Shmakov, General Manager, Field Operations, Mukhit Mazhenov, Eastern Region Manager, Alexander Antonov, CPC-K Contract Manager. KazTransOil was represented by Deputy General Director Alexey Pirogov, Erkin Nurzhau,Deputy Director, Operator and Service Department, and Kanat Baymukhanov, Chief Engineer, Western Department for Provision of Services.

The parties discussed the Companies’ cooperation matters within the Contract for maintenance, repair and emergency response at CPC-K crude pipeline system facilities in the Republic of Kazakhstan signed in May 2018. Under the Contract, KazTransOil units commenced the performance of the aforesaid functions on July 1, 2018.

At the meeting, the Companies’ Heads reviewed the matters pertaining to provision of KazTransOil relevant units with specialized vehicles and equipment for emergency oil spill respnse and the progress of reconstruction of the Emergency Response Stations (ERS) bases: Tengiz ERS and Isatay ERS.

As a reminder, the Contract between CPC and KTO is signed for five years - from 2018 through 2023. The Contract value amounts to approximately KZT 23 B (about $70 M).

For reference.

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%.