This article is from the source 'nytimes' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.nytimes.com/2013/09/12/business/global/kazakhstan-oil-field-starts-production-after-years-of-delay.html

The article has changed 3 times. There is an RSS feed of changes available.

Version 1 Version 2
Kazakhstan Oil Field Begins Production After Years of Delay Kazakhstan Oil Field Begins Production After Years of Delay
(about 1 hour later)
MOSCOW — After years of delay, the largest oil field outside the Middle East started producing crude on Monday, offering a valuable new deposit to meet the world’s rising energy needs.MOSCOW — After years of delay, the largest oil field outside the Middle East started producing crude on Monday, offering a valuable new deposit to meet the world’s rising energy needs.
The first oil to flow from the Kashagan field, in Kazakhstan, was just a trickle. But a consortium of oil companies, including Exxon Mobil and ConocoPhillips of the United States, have ambitious plans to increase production over the next several years.The first oil to flow from the Kashagan field, in Kazakhstan, was just a trickle. But a consortium of oil companies, including Exxon Mobil and ConocoPhillips of the United States, have ambitious plans to increase production over the next several years.
“This is one of the most complicated projects in the world,” Claudio Descalzi, the chief operating officer for exploration and production at Eni, the Italian oil company involved in the project, said in a telephone interview. “It’s really an historical moment. It’s first-quality oil, very light oil, and we are close to countries that are growing, and that present the best markets.”“This is one of the most complicated projects in the world,” Claudio Descalzi, the chief operating officer for exploration and production at Eni, the Italian oil company involved in the project, said in a telephone interview. “It’s really an historical moment. It’s first-quality oil, very light oil, and we are close to countries that are growing, and that present the best markets.”
When geologists discovered the field in 2000, it was the largest new deposit since the discovery of the Prudhoe Bay field on the North Slope of Alaska in 1968. And it remains so today, suggesting that such oil sources are becoming harder to find.When geologists discovered the field in 2000, it was the largest new deposit since the discovery of the Prudhoe Bay field on the North Slope of Alaska in 1968. And it remains so today, suggesting that such oil sources are becoming harder to find.
But the project has been stalled for years, amid technical problems, disputes with the Kazakh government, and infighting among the oil companies. Such fields have also become less important to the industry, given the advances in pumping oil from abundant shale reserves. But the project has been stalled for years, amid technical problems, disputes with the Kazakh government and infighting among the oil companies. Such fields have also become less important to the industry, given the advances in pumping oil from abundant shale reserves.
As they move forward, the companies tapping into the reserve — KazMunayGas, the national oil company of Kazakhstan; Shell of the Netherlands; Total of France; Inpex of Japan; Exxon; Conoco; and Eni — are taking a slow-and-steady approach.As they move forward, the companies tapping into the reserve — KazMunayGas, the national oil company of Kazakhstan; Shell of the Netherlands; Total of France; Inpex of Japan; Exxon; Conoco; and Eni — are taking a slow-and-steady approach.
While they have drilled scores of wells, the initial production is just 26,000 barrels a day, a mere drop in the global oil bucket. Eventually, the project could add about 1.5 million barrels of oil a day to global output. If it reaches that level, the oil will amount to about 1.6 percent of the world’s total, or roughly the amount Libya produces.While they have drilled scores of wells, the initial production is just 26,000 barrels a day, a mere drop in the global oil bucket. Eventually, the project could add about 1.5 million barrels of oil a day to global output. If it reaches that level, the oil will amount to about 1.6 percent of the world’s total, or roughly the amount Libya produces.
The cautious approach, in part, reflects the nature of the project. The very characteristics that caused the field to be overlooked for decades — its depth and location in the Caspian Sea — pose major risks.The cautious approach, in part, reflects the nature of the project. The very characteristics that caused the field to be overlooked for decades — its depth and location in the Caspian Sea — pose major risks.
The oil is under tremendous pressure as it comes out of the ground, amplifying the possibility of a significant spill. The sea is home to endangered sturgeon and a rare species of seal. The crude is also mixed with poisonous natural gas, so workers carry gas masks in case of leaks.The oil is under tremendous pressure as it comes out of the ground, amplifying the possibility of a significant spill. The sea is home to endangered sturgeon and a rare species of seal. The crude is also mixed with poisonous natural gas, so workers carry gas masks in case of leaks.
As part of a series of a safety conditions, the companies piled up artificial islands for drilling pads and laid pipelines on the seabed, which has added to the delays and expenses. The project is already five years behind schedule and has cost $41 billion.As part of a series of a safety conditions, the companies piled up artificial islands for drilling pads and laid pipelines on the seabed, which has added to the delays and expenses. The project is already five years behind schedule and has cost $41 billion.
“It’s very important to prove to everybody that we are able to develop this type of complex reservoir,” said Mr. Descalzi of Eni.“It’s very important to prove to everybody that we are able to develop this type of complex reservoir,” said Mr. Descalzi of Eni.