KazMunayGas, Lukoil to make final investment decision on Kalamkas-Sea, Khazar and Auezov projects in 2025

MOSCOW. May 3 (Interfax) - Kazakhstan's National Company KazMunayGas (KMG) and Russia's Lukoil will reach a final investment decision (FID) on the Kalamkas-Sea, Khazar and Auezov projects in the Kazakh sector of the Caspian Sea in 2025, according to KMG's annual report for 2023.

After the contractor has been selected, a front-end engineering and design project (FEED Engineering) will be carried out during 2024 as part of Phase 3. The FEED Engineering is expected to be completed by the end of 2024, and the final investment decision will be taken in 2025, the report says.

According to KMG's preliminary estimates, investment in the Kalamkas-Sea, Khazar and Auezov projects will amount to about $6.4 billion compared with previous estimates of around $5 billion.

In 2023, Kalamkas-Khazar Operating LLP, which is owned by KMG and Lukoil on a parity basis and holds the hydrocarbon development license, carried out a number of exploration programs to speed up the Kalamkas-Sea, Khazar and Auezov projects. The exploration programs included offshore and onshore engineering and geological surveys, production and environmental monitoring, and interpretation of data collected in the course of 3D seismic surveys.

The Kalamkas-Sea, Khazar and Auezov development projects were approved by Kazakhstan's Central Commission for Hydrocarbon Exploration and Development in September 2023.

Kalamkas-Sea, Khazar and Auezov fields are located in the Kazakh sector of the Caspian; with producing horizons lying 1,500-2,000 meters below the seabed level.

Commercial production of the Kalamkas-Sea and Khazar fields is slated for 2028-2029. The recoverable reserves of the two fields are estimated at 48.5 million tonnes of oil and 19 billion cubic meters of gas. The production rate is anticipated to be around 4 million tonnes per year or 80,000 barrels per day for as long as five years, according to the report.