Drilling off Kazakstan

August 18, 1999, 10:00 CEST

The first exploration well in Kazakstan's sector of the Caspian was spudded on Saturday 14 August by a consortium which includes Statoil.

Both Nurlan Balgimbayev, prime minister of the Central Asian republic, and journalists were present on the Sunkar rig for a special ceremony to mark this event. This was followed by a gala dinner.

Operator for the well is the Offshore Kazakstan International Operation Company (Okioc), which embraces Agip, British Gas International, BP Amoco, Inpex, Mobil, Phillips Petroleum, Shell and TotalFina as well as Statoil.

The present work forms part of an exploration programme being pursued under a production sharing agreement with the Kazak government.

"We expect to penetrate the actual reservoir late this year," says Knut Henrik Jakobsson, Statoil's project manager for Kazakstan.

Kashagan East, where the exploration well is being drilled, could prove to be one of the world's largest hydrocarbon deposits.

"Okioc expects to find substantial volumes of oil, perhaps corresponding to a couple of Statfjord fields," says Mr Jakobsson. This could amount to roughly 14 billion barrels of oil.

The well is unlikely to be tested until early 2000, when the winter ice in the Caspian has melted.

Another exploration well is due to be drilled next year in the Kashagan structure, and that work will again be done by Sunkar.

Owned and operated by Parker Drilling Company, this rig was towed from a Russian yard in Astrakhan to Kashagan East earlier this summer. It has been converted at a cost of roughly NOK 800 million to operate under extremely difficult conditions in the north-eastern Caspian.

Drilling is being pursued in open waters only three-four metres deep and about 180 kilometres from land. Extensive icing in winter and complex geological conditions present further challenges.

Natural conditions and animal life in the area are very sensitive, and Okioc faces stringent environmental requirements.