Kazakh oil group plans $4 bn link to Baku pipeline

Total's Alain Przybysz told reporters this would involve building a 800 km pipeline from offshore Kashagan to the Kazakh shore, two terminals on the Kazakh and Azeri sides of the Caspian Sea, and tankers to take oil across the Caspian. The link would be operational by 2010, when Kashagan is due to start producing large quantities of oil.

"The Kazakhstan Caspian Transport System will provide one of the major oil export routes from Kashagan without damage to the Caspian environment," Mr Przybysz said. "I think that in the future this transport system could be linked to the Russian, Chinese, and Iranian systems," he added.

He said the system could transport oil from other fields as well as Kashagan. "This is the subject of talks between Kazakhstan and Azerbaijan, which are close to signing an international agreement," Mr Przybysz added.

Total will finance the link along with its partners in Kashagan, Italy's Eni, US firm ConocoPhillips and Japan's Inpex, all shareholders in the Baku-Ceyhan pipeline, which is due to be officially launched next month. The Kashagan field will start producing from its reserves of more than 2 billion tonne of oil and more than 1 trillion cubic metre of gas in 2008, but its production does not have an export route from the land-locked Caspian Sea.

Kashagan, the world's biggest discovery in the past 30 years, is expected to produce more than 10 lakh barrels per day (bpd) sometime next decade.

The Baku-Ceyhan pipeline will also pump at least 10 lakh bpd, and most of its capacity is expected to be taken in early years by a group led by BP Plc, which is developing a big Azeri offshore field.

Kazakhstan plans to transport 50,000 crore bpd of Kashagan oil through Baku-Ceyhan, rising to 10 lakh bpd when chemical agents are used and extra pumping stations are added to lift the pipeline's capacity.

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