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Kazakhstan And China Discuss Expanding Oil Pipelines

Kazakhstan's state oil and gas firm KazMunayGas and China National Petroleum Corporation (CNPC) are discussing the possible expansion of two oil pipelines, KazMunayGas officials have told Russian news agency Interfax.

The Kenkiyak-Atyrau and Kenkiyak-Kumkol oil pipelines could see their throughput raised, which could lift the volumes of Kazakhstan's crude oil exports to China.

The capacity of the Kenkiyak-Atyrau oil pipeline could be doubled to 12 million tons annually from 6 million tons, while the Kenkiyak-Kumkol pipeline capacity could be expanded to 15 million tons per year from 10 million tons annually at present.

Last year, 4.5 million tons of oil were pumped via the Kenkiyak-Atyrau pipeline, while 8.1 million tons were shipped via the Kenkiyak-Kumkol pipeline, KazMunayGas told Interfax.

Kenkiyak-Kumkol is the first section of the Kazakhstan-China Pipeline, which transports crude oil from West Kazakhstan and Aktobe oilfields.  

Last week, KazMunayGas' chief executive Magzum Mirzagaliyev said that the expansion of the Kazakhstan-China pipeline would cost $200 million.

"The cost of the expansion project will be about $200 million. We intend to start work next year and complete it in two or three years," Mirzagaliyev said on the sidelines of the Kazakh-Chinese talks in Xi'an last week.

At the event in Xi'an, and as part of the visit of Kazakhstan's President Kassym-Jomart Tokayev to China, KazMunayGas and China's state-held energy giant CNPC signed an agreement to expand their strategic cooperation in the oil and gas industry.

The agreement includes boosting cooperation in geologic exploration and oil refining, as well as exploring opportunities to increase the volume of transportation through the Kazakhstan-China oil pipeline.

"KazMunayGas and CNPC have developed strong relationship of trust over many years of joint work, oil and gas projects that are important for Kazakhstan are being jointly implemented. The Agreement signed today is the next stage in strengthening the partnership between the companies," Mirzagaliyev said.  

By Tsvetana Paraskova for Oilprice.com

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Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.  More

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