The economic downturn will not affect the development of Kazakhstan's Kashagan oil field, said a Shell executive, according to a Reuters report. In fact, he added, the present economy may even help minimize development costs.
"The plan is still to have first production as announced, in the fourth quarter of 2012," Shell's Caspian manager Campbell Keir told reporters. "The economic situation and the low oil price should allow us to bring the cost down."
Located 80 kilometers southeast of Atryrau, Kashagan was discovered in July 2000. Considered the most important discovery in the last three decades, the giant offshore field is estimated to hold some 7 to 9 billion barrels of gross recoverable reserves, which may be extended to 13 billion barrels through gas re-injection.
Sanctioned in February 2004, field development on Kashagan will be carried out through three phases. Developed through production hubs on platforms and man-made islands, production was initially scheduled for 2008, but cost overruns and development revisions have postponed the start-up. The first developmental phase alone is projected to cost $19 billion.
Although there have been disagreements between project partners and the Kazakh government, a MOU was signed in January 2008 that resolved the conflict. Once all phases of development are complete, full field production at Kashagan is expected to plateau at 1.5 million barrels a day.
Eni serves as operator of the Kashagan oil field with 18.52%. Partners on the massive project include Total (18.52%), Shell (18.52%), ExxonMobil (18.52%), ConocoPhillips (9.26%), Impex (8.33%) and KazMaunayGas (8.33%).
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