Oil Flow from Kazakhstan's Kashagan Field Expands through Baku-Tbilisi-Ceyhan Pipeline, Predicting Booming Future
A NEW ERA IN ENERGY COOPERATION: KAZAKHSTAN'S KASHAGAN OIL AND THE BAKU-TBILISI-CEYHAN PIPELINE
Welcome, folks! Here's a scoop on East-West energy partnerships at play, specifically Kazakhstan and Azerbaijan's growing ties through the Kashagan oil field and the Baku-Tbilisi-Ceyhan (BTC) pipeline.
Kazakhstan recently exported its first batch of Kashagan oil via BTC, triggering a buzz about the prospects of expanding volumes between the two nations. Have a look at this map to visualize the Kashagan field’s location between the Caspian Sea and the Kazakh-Azerbaijani border.
[Credit: The Astana Times]
Back to the story, a few months ago, Kazakhstan took its first steps towards this collaboration, transporting approximately 6,000 tons of Kashagan oil via BTC. This move was evaluated by Azerbaijani experts regarding its longevity.
Economist Anar Azizov from Azerbaijan sees the beginning of Kashagan oil transportation as the next wave in their energy cooperation. In his words, "Baku and Astana have intensified cooperation in the energy sector over the past three years, especially in Kazakh oil transit. Kazakhstan has been looking for ways to diversify its oil export routes since 2022, and Baku is eager to provide Kazakhstan with free capacities of BTC."
Azizov predicts an increase in the Kazakh oil volumes shipped through Azerbaijan, with a potential reach of up to 20 million tons over the next five to seven years. He also suggested that underutilized pipelines like Baku-Supsa could also be employed.
The road to this ambitious goal, according to Azizov, involves expanding tanker fleets on the Caspian Sea to boost oil transit volumes. Both countries are reportedly making strides in this direction, and the Baku shipyard could potentially play a role.
Transporting Kashagan oil via BTC represents a landmark moment in Kazakhstan's history, according to expert Rauf Aghamirzayev. Aghamirzayev finds it essential for Kazakhstan to diversify its energy routes and considers the BTC pipeline a timely asset — one that opens up secluded Caspian resources for global markets.
In the future, thanks to BTC, Lada Yevgrashina, an Azerbaijani energy expert, anticipates growing oil volumes and the possible use of the Baku-Supsa pipeline, which connects Baku and the Black Sea coast of Georgia. However, she points out that increasing sulfur content and infrastructure challenges remain key concerns with BTC.
Despite these obstacles, experts seem optimistic about the long-term prospects of Kashagan oil shipments through BTC, provided that infrastructure is modernized, crude oil blending facilities improve, and costs are optimized. The collaborative efforts of Kazakhstan and Azerbaijan in maintaining interstate cooperation and technology sharing, navigating OPEC+ dynamics, and securing transit agreements further fuel this promising alliance.
With Kazakhstan aiming for total oil output of over 100 million tons by 2030, 20 million tons of Kashagan oil shipped through BTC by the same year seems like an achievable dream. Keep your eyes on these two powerhouses as they strengthen their partnership in the energy sector!
Additional Insights:- Kazakhstan's plans for future volumes of Kashagan oil shipments through the Baku-Tbilisi-Ceyhan (BTC) pipeline indicate significant growth over the coming years, with targets of potentially reaching 20 million tons per year by 2030[1][2].- The BTC pipeline itself remains underutilized, transporting about 29.47 million tons in 2024 which is significantly less than its 60 million tons per year design capacity[1]. Kazakhstan’s oil production is also on the rise, with production expected to reach around 130 million tons by 2030[3].- Collaboration on hydrocarbon exploration, production, and transit agreements between Kazakhstan and Azerbaijan enhances operational efficiency and potentially accelerates production growth and export volumes[4].- Several factors will influence the long-term viability and growth of Kashagan oil shipments through the BTC pipeline, including oil production growth, infrastructure development, global oil price levels, interstate cooperation, OPEC+ dynamics, and transit agreements[1][2].
The strategical oil export of Kashagan oil via Baku-Tbilisi-Ceyhan (BTC) pipeline by Kazakhstan opens up possibilities for increased volumes, potentially reaching up to 20 million tons annually by 2030, as predicted by economist Anar Azizov. This upward trend in oil transportation between Kazakhstan and Azerbaijan could further expand to include underutilized pipelines like Baku-Supsa.
The energy sector collaboration between Kazakhstan and Azerbaijan, with a focus on Kazakh oil transit, is seen as a significant development in the finance and oil-and-gas industry, as both countries work towards diversifying their energy exports and increasing operational efficiency.
