Lukoil Submits Application For Pumping 5.4 Mln Tonnes Of Oil Through CPC

Caspian Pipeline Consortium Increased Oil Export By 9.1% In Q1

Lukoil (MOEX: LKOH) has submitted an application for pumping 5.4 million tonnes of oil through the system of the Caspian Pipeline Consortium (CPC), Transneft (MOEX: TRNF) said in its corporate journal.

It was reported that Lukoil intends to ship all oil from the Filanovsky field, which it commissioned in October of this year, to the CPC system. The journal reported that in 2017 Lukoil expects to produce 4.4 million tonnes of oil at the field, and by 2019 to reach peak production of 6 million tonnes of oil a year.

“In addition, starting in this year Lukoil resent oil from the Korchagin field, another field in the Caspian, to the CPC pipeline, which had been sent earlier to the Baku-Tbilisi-Ceyhan system. Transportation to Novorossiysk is cheaper for the company than transportation to the Turkish port. In order to implement this project, Lukoil has joined Filanovsky and Korchagin fields with a pipeline,” the publication said.

About 5 million tonnes of oil from Rosneft (MOEX: ROSN) is coming to the CPC pipeline, Rosneft supplies crude via railway to the Kavkazkaya oil acceptance point in the Krasnodar territory, the journal said.

In addition, in 2017 it is planned to increase oil pumping via the CPC from fields in Kazakhstan. The publication said that in 2016, 25 million tonnes of oil from the Tengiz and Korolev fields were pumped in the CPC system, the plan for 2017 is 27 million tonnes. In 2017 it is planned to pump 12 million tonnes of oil from the Karachaganak field (in 2016, 10 million tonnes were pumped).

“If there are no interruptions, then by the end of 2016 there should be up to 1 million tonnes of Kashagan oil, next year – up to 9 million tonnes. According to the forecasts of the Kazakh Energy Ministry, the peak of production of 13 million tonnes for the first phase of development of the Kashagan field will be reached in 2020,” the publication said.

It was reported earlier that for 2016, pumping volume via the CPC is expected at 45.8 million tonnes. In 2017 it is planned to pump 67 million tonnes of oil, of which 56 million tonnes are supplied by Kazakh producers and 11 million tonnes by Russian ones. So, in 2017 oil transportation volumes via the CPC system may rise by 46% in comparison with the figure for 2016.

The CPC pipeline joins oil fields in the west of Kazakhstan and maritime terminals in Novorossiysk. It is 1,511 kilometers long.

CPC shareholders include Russia (Transneft – 24% and CPC Company – 7%) – 31%, Kazakhstan (KazMunayGaz – 19% and Kazakhstan Pipeline Ventures LLC – 1.75%) – 20.75%), Chevron Caspian Pipeline Consortium Company – 15%, Lukarco B.V. – 12.5%, CPC Mobil – 7.5%, Rosneft-Shell Caspian Ventures Limited – 7.5%, BG Overseas Holding – 2%, Oryx Caspian Pipeline LLC – 1.75%, Eni International N.A N.V. – 2%.