KARACHAGANAK ACTIVITY REVIEW AND
LONG TERM DEVELOPMENT PLANS
WORLD CLASS EXPERTISE – WORLD CLASS ASSET
Luca Vignati
Aktau, 25 September 2012
FIELD OVERVIEW
One of the world’s largest gas condensate fields;
 Discovered in 1979;
 Gross reserves – over 2.4 billion barrels of
condensate and 16 tcf of gas.

New agreement – 14 December 2011
29.25%
The Republic of Kazakhstan, the Contracting Companies and
KPO have recently completed the agreement in relation to the
Karachaganak Project that was initially signed on 14 December
2011.
29.25%
18%
13.5%
10%
Under the terms of the agreement the Republic has acquired a
10% interest in the Karachaganak Final Production Sharing
Agreement.
The Republic’s interest in the Final Production Sharing
Agreement will be managed by the national oil company,
KazMunaiGas (KMG).
The consideration under the agreement also includes the
allocation of an additional 2 million tonnes per year capacity in
the Caspian Pipeline Consortium export pipeline over the
remaining life of the Final Production Sharing Agreement .
RESERVES AND INVESTMENTS
Karachaganak holds an estimated 9 billion barrels of
condensate and 48 trillion cubic feet (tcf) of gas.
To date, around 7-8% of the recoverable hydrocarbons
initially in place have been produced.
Since the signing of the FPSA:
• $15.3 bln invested into developing the field, applying
industry leading technology aimed at maximizing
sustainable economic value
• $14.6 bln of direct payments to RoK budget
FACILITIES OVERVIEW
Stabilised Oil
KPC
CPC
Fuel Gas
2.4MSm3/d
Unstabilised Oil
Unit 3
Orenburg
65 000 BOEPD
242 402 BOPD
Sour Gas
Sour Gas
Orenburg
24 MSM3/day
Power
Mini
Refinery
Community
Unstabilised Oil
50 MW
15 000 BOEPD
Production
from Wells
Production
from Wells
Unstabilised Oil
Unit 2
Injection
Wells
Sour Gas to Re-injection
24 MSM3/day
Production
from Wells
PRINCIPAL EXPORT ROUTES
 KPC- Atyrau oil pipeline
(635km), operating since 2003
 Two pumping stations, one at
KPC, the other at Bolshoi
Chagan; terminal at Atyrau
for receipt and storage
 Stabilised liquids exported
via CPC and Atyrau – Samara
 Principal sale points of
stabilised liquids are
Novorossyisk (Black Sea) and
Primorsk (Baltic)
 Sour gas and unstabilised
liquids sent to Orenburg
2011
2010
2009
2008
2007
2006
2005
PSPA
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1988
400
1987
500
1986
1985
1984
) per day
K Barrels
PRODUCTION AND INJECTION HISTORY
600
FPSA
Gas Injection
Gas Sales
Liquid Production
300
200
100
0
Field Development Plan - Gas Balancing
Description
P2M
P2ME
P2ME2
P2ME3
 Maximise production of
liquids based upon current
gas handling limitations
 Transfer currently shut-in
KPC wells to Unit 2
 Installation of two 5960m
10” pipelines between
RMS-M and Unit2
Proposed Gas
Balancing lines
Gas Balancing
2011
Q1
FEED (internal)
VAR 3
FID
Bid & Award LLI
Deliver Line Pipe
Deliver Valves
Detailed Design
Prefabrication & RMS M mod.
Pipeline Construction & Commissioning
Start Up
Q2
2012
Q1
Q2
Q3
2013
Q4
Q1
Q2
Q3
2014
Q4
Q1
Q2
Q3
2015
Q4
Q1
Q2
Q3
Q4
Field Development Plan - Plateau Extension Wells
(P2ME3)
Structure on Top Reservoir
Description
 Continuation of existing
Phase IIM,P2ME and
P2ME2 drilling programme
 Commencing either
 2017 – 1 rig
 2014 – 2 rigs
 Total 12 wells
Phase 2ME (purple)
Phase 2ME2 (brown)
Phase 2ME3 (yellow)
Field Development Plan - Unit 2 Gas Injection Upgrade
Project
Description
 Maximise volume of injected gas
with existing facilities
 Phase 1
Additional trunk line
 Additional gas/liquid separation
equipment for sustained flowrate
 Phase 2
 Process plant, field injection
facilities and wells
Unit 2
Unit 2 Gas Injection Upgrade Project
2011
Q1
Evaluation
VAR 1
Pre FEED
VAR 2
FEED (internal)
VAR 3
FID
Execution
Production
Q2
2012
Q1
Q2
Q3
2013
Q4
Q1
Q2
Q3
2014
Q4
Q1
Q2
Q3
2015
Q4
Q1
Q2
Q3
2016
Q4
Q1
Q2
Q3
2017
Q4
Q1
Q2
Q3
Q4
Field Development Plan - KPC Gas Debottlenecking Project
Description
 Increase overall KPC gas
processing by expanding MP gas
handling capacity
 MP gas handling system enhanced
including new combined MP
dehydration and dew-pointing train
 Potential additional pipeline from
KPC to Unit 3
KPC Gas Debottlenecking Project
2011
Q1
Train 4 Test Run
Mobilise Project Team
Concept Studies
VAR 2
FEED
Tender & Award EPC
VAR 3
FID
Execution
Start Up
Q2
2012
Q1
Q2
Q3
2013
Q4
Q1
Q2
Q3
2014
Q4
Q1
Q2
Q3
2015
Q4
Q1
Q2
Q3
2016
Q4
Q1
Q2
Q3
2017
Q4
Q1
Q2
Q3
Q4
2011 PERFORMANCE & ACHIEVEMENTS
SAFETY
 LITF & RTIF – KPO in the top 10 best performers of oil & gas producers
 Road Traffic Incident – reduction of 85% from 2010
ENVIRONMENT
 Gas Utilisation Rate - 99.92% (99.87% in 2010) whilst the regulatory
target approved within gas utilisation programme is 99.75%.
LATEST PROJECTS
 TRAIN 4 - State Acceptance on 1 Dec. 2011
 UGPP - State Acceptance on 9 Sept. 2011
 3rd Storage tank on KPC
LOCAL CONTENT
Some 2,500 Kazakh vendors are currently registered on supplier
database.
Since beginning of the FPSA in 1997, total value of contracts assigned
to Kazakh companies exceeded $4 billion.
In 2011, KPO awarded contracts worth over $428 million to 341 Kazakh
companies for the provision of goods, works and services.
In Q2 2012 the Local Content in Karachaganak project makes up to 56%
LOCAL CONTENT DEVELOPMENT INITIATIVES
•
Pilot Project on organizing the manufacturing of high technology products for KPO and
other O&G operators’ needs
•
Aksai Industrial Park project is under implementation
•
AIP Project included to the Industrialisation Map, will employ 130 experts
•
Spare Parts and Equipment Manufacturing Localisation Project
•
By WKO Entrepreneurs Association and support of WKO Akimat Technical Expert
Group has been created to perform the project.
•
Working Group of KMG, KPO and “Kazakhstan Union of Machinery building companies”
was created
•
Local Content reporting in compliance with the current legislation requirements
•
KPO was registered in the MOG reporting system
•
Integrated Contract Plan for 2011-2014 placed on to KPO web-site and become visible
for all RoK business union
HUMAN RESOURCES
Total KPO Employees – 3681
NATIONAL EMPLOYEES UP TO 93% OF TOTAL KPO POPULATION
KPO NATIONAL STAFF HAS GROWN FROM:
1,186 IN THE YEAR 2000
3,410 NOW
EXPATRIATE RESOURCES HAVE BEEN REDUCED BY 55% FROM:
587 IN THE YEAR 2000
271 NOW
Investments (plan 2012)
• Annual nationals salary fund – $163 M
• Annual training and development budget for nationals – $14.5 M
• Annual payments for nationals as a part of collective agreement and
company social responsibility – $6.2 M
KPO NATIONALIZATION PROGRAMME (2009-2018)
KPO Nationalization trend 1998 - 2037
Nationalization as of 31 of January 2012 vs Plan
Cat
Description
31 Jan, 2012
Target 2013 (program)
Dec, 2018
1
Management
69%
60%
70%
2
Professional staff and Supervisors
95%
91%
95%
3
Technical staff
100%
100%
100%
4
Support and Clerical
100%
100%
100%
THANK YOU!