NUR-SULTAN
Kazakhstan is set to increase oil production to 1.508 million barrels per day (bpd) in September under a fresh decision made by the OPEC+ grouping.
As the COVID-19 pandemic disrupted production as well as demand for oil, OPEC+, a group of the Organisation of the Petroleum Exporting Countries (OPEC) and allied producers of which Kazakhstan is a member, cut output by a little more than 7 million bpd to support prices and reduce oversupply. Other former Soviet oil-producing countries, Russia and Azerbaijan, are also OPEC+ members.
In April 2021, members of the group agreed to ease cuts gradually by 350,000 bpd in May, another 350,000 bpd in June and around 450,000 bpd in July.
In July, OPEC+ ministers decided to increase total production from August by 400,000 bpd every month and to hold monthly consultations for assessing the market and the feasibility of increasing production.
The new deal envisages a further increase by another 400,000 bpd from October. It has been made amid a rising number of COVID-19 infections across the world and firm prices on oil markets. Saudi Arabia cut oil prices for sales to Asia next month by more than twice the expected amount in a sign that it wants to entice buyers to increase purchases.
Kazakhstan, which has been advocating for increased production quotas, welcomed the decision to boost production levels. The resource-rich ex-Soviet country is now scheduled to produce 1.508 million bpd in September, up from 1.491 million bpd in August and will be adding a further 16,000 barrels every month, Energy Minister Nurlan Nogaev said.
Kazakhstan produced 49.8 million tonnes of oil and gas condensate in the first half of 2021, in compliance with the country’s obligations under the OPEC+ deal.
Most of Kazakhstan’s oil and condensate output comes from the Tengiz, Kashagan and Karachaganak oilfields.
The Tengiz field is operated by the Tengizchevroil, a consortium led by U.S. oil group Chevron. It also includes the U.S. Exxon Mobil, Russia’s LUKOIL and Kazakhstan’s state energy firm KazMunayGaz.
The Kashagan field is operated by an international consortium led by the North Caspian Operating Company. Other partners include Eni, Exxon Mobil, CNPC, Royal Dutch Shell, Total, Inpex and KazMunayGaz.
The Karachaganak gas condensate field in northwest Kazakhstan is jointly operated by Eni and Shell. Other shareholders in the project are KazMunayGaz, Chevron and LUKOIL.
Oil production in Kazakhstan in 2020 reached 85.7 million tonnes. In 2021, the Central Asian country plans to produce 86 million tonnes of crude.