CPC guarantees efficient and environmentally safe movement of crude oil

The Project is designed to increase the trunk pipeline capacity

CPC and the Krasnodar Krai sign a supplementary agreement on cooperation

Caspian Pipeline Consortium and the Krasnodar Krai Administration on 16 June signed a Supplementary Agreement to the Agreement on Cooperation between the company and the region signed on September 17, 2010. The new document was signed by Nikolai Brunich, CPC-R General Director, and Veniamin Kondratiev, acting head of the Krasnodar Krai Administration (Governor) . The newly signed agreement provides for additional funds to be allocated by the consortium in the amount of 145 million rubles to finance community-related projects throughout the region under the Expansion Project.

The signing ceremony was also attended by members of the Krasnodar Krai Government, CPC representatives and heads of municipalities that are crossed by the CPC pipeline route where additional production facilities of CPC are under construction.

The Head of the Krasnodar Krai Veniamin Kondratiev commented on the considerable contribution made by CPC-R as a good corporate citizen to the development of the infrastructure in the region, which he had recently been able to witness by opening the Kuban Stadium in the Krymskiy District reconstructed at the expense of the Consortium. Nikolay Brunich in his turn promised that the cooperation between the company and the region would continue. In particular, he informed about the intention to invest an additional 145 million rubles to implement community-related projects in Novorossiysk where CPC-R is registered and where one of its most important infrastructure facilities, the Marine Terminal and the Tank Farm, are located.

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%