Top Western oil producers could experience a hit to revenue if disruptions at a Russian Black Sea port curtail output from Kazakhstan’s giant oilfields, highlighting the growing global supply risk after Moscow’s invasion of Ukraine.
Chevron, Exxon Mobil, Shell, TotalEnergies and Italy’s Eni are among international companies with stakes in Kazakhstan’s oilfields.
Most of the central Asian country’s crude is exported via the Caspian Pipeline Consortium (CPC) pipeline to the port of Novorossiisk, supplying around 1.2% of global oil demand.
The port’s operator shut down two of the three berths at the CPC export terminal on Wednesday, blaming damage from a recent storm, although loadings were partially resuming from one on Thursday.
However, that is unlikely to stop the limited storage capacity at the port filling up, meaning oilfield output would have to be curtailed. Traders had earlier estimated it would take less than 24 hours to reach capacity after loadings were suspended.
Sources with knowledge of the terminal said they believed it was unlikely the site’s berths were significantly damaged by the storms, which have been built to withstand severe weather, pointing instead to Russian politics in the face of heavy Western sanctions.
Russian energy officials do not usually comment on the CPC pipeline, which is run by an international consortium. A spokesperson for Chevron, which operates the CPC pipeline, declined to comment.
The 1,511 kilometer-long pipeline exports around 1.1 million barrels per day, the equivalent of around $144 million based on current oil prices. Its owners also include Exxon, Eni, Shell, domestic energy company KazMunayGas, and Russian pipeline operator Transneft.
The barrels include the roughly 700,000 a day produced from Kazakhstan’s largest oil venture Tengizchevroil (TCO), owned by a consortium of producers and operated by Chevron CVX.N, which holds a 50% stake in the project while Exxon holds 25%.
CPC is also the main export route for the Kashagan oilfield with production of about 400,000 bpd.
TCO accounted for more than 10% of Chevron’s production last year at 338,000 barrels per day. For Exxon, Kazakhstan accounted for 210,000 bpd in 2020, almost 10% of the company’s total oil output.
Shell declined to comment. Exxon, Eni, and TotalEnergies did not immediately respond to a request for comment.
(Reporting by Ron BoussoEditing by David Goodman, Kirsten Donovan)
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