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Growing oil output may negatively affect Kazakhstan-OPEC deal

07 June 2018 [13:42] - TODAY.AZ

By  Trend

Rising oil production at Kazakhstan's three largest fields - Tengiz, Karachaganak and Kashagan - could negatively affect Kazakhstan's participation in the OPEC+ agreement, which stipulates output cut to stabilize prices in the world markets, Chief Researcher at Kazakhstan's Institute of Economics, consultant at Kazakhstan's Energy Ministry Oleg Egorov told Trend.

"The volume of oil production at the Tengiz field is planned to rise from 25 million tons to 35 million tons. However, even if this process drags on, the main obstacle to the agreement between OPEC and Kazakhstan is expansion of the relatively new Kashagan field, oil output at which hit 4 million tons only in 2017," Egorov said.

The expert stressed that in case of a continuous increase in Kazakhstan's oil production, the country will either withdraw out of the deal with the cartel, or achieve changes in the agreement.

According to Egorov, withdrawing from the deal is currently unprofitable for Kazakhstan.

Earlier, Energy Minister Kanat Bozumbayev said that Kazakhstan intends to gradually increase oil production from current 86 million tons to 104 million tons annually by 2025.

"During five months of 2018, oil production in the country reached 37.7 million tons, showing an increase of 6 percent compared to the same period in 2017. This year, according to our forecasts, the oil production will hit 87 million tons," Bozumbayev said.

The minister noted that the oil production growth will be achieved mainly through the Tengiz, Karachaganak and Kashagan fields.


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