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Top Kazakh oil field hits record output amid tensions with OPEC+, sources say
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Top Kazakh oil field hits record output amid tensions with OPEC+, sources say
Oct 10, 2024 10:09 PM

MOSCOW, Oct 9 (Reuters) - Kazakhstan's biggest oil field

Tengiz, operated by U.S. major Chevron ( CVX ), boosted output

to a record high in October, sources told Reuters, potentially

complicating the country's future efforts to comply with its

OPEC+ quota.

OPEC+ has named top 10 global oil producer Kazakhstan along

with Iraq and Russia as countries that have repeatedly failed to

comply with its pledges to curb oil production this year.

Tengiz boosted daily production to 699,000 bpd in early

October from 687,000 bpd in September, when output increased by

30% from August after the completion of maintenance, said two

industry sources familiar with the data.

The field's operator Tengizchevroil, which has invested more

than $70 billion since the project's inception in 1993, said its

operations were continuing as usual and declined further

comment.

Chevron ( CVX ) owns a 50% stake in the venture. Exxon Mobil ( XOM )

controls 25%, KazMunayGaz has a 20% stake, and

Russia's Lukoil owns 5%.

The Kazakh energy ministry did not reply to a request on

comment about oil production plans for 2024 and 2025.

Kazakhstan - which relies on Tengiz and two other major

fields, Karachaganak and Kashagan, for most of its production -

is subject to output targets as a member of OPEC+, an alliance

of OPEC and other top producers led by Russia

The country's oil production quota under the OPEC+ deal

stands at 1.468 million bpd, a target it exceeded in September

by around 170,000 bpd, according to Reuters calculations.

It is likely to remain within its targets this month because

it will shut down the Kashagan field for maintenance, sources

said.

Overall October production data from Kazakhstan is not yet

available, but sources said Karachaganak will produce its

regular volumes of 228,000 bpd, while maintenance at Kashagan

will entail a complete stoppage of its 400,000 bpd facility.

While that means Kazakhstan will be able to achieve its

October quota, the sources said, complying with OPEC+ quotas

might become problematic again when the field returns from

maintenance in November.

"Taking into account the expansion of Tengiz, compliance

with the quota could become impossible," one of the sources

said.

Chevron ( CVX ) and its partners plan to expand output at the Tengiz

project to 850,000 bpd in the first half of 2025. Expansion

costs at the project stand at around $49 billion.

OPEC will release estimates of its members' September oil

output next week.

The group's leader Saudi Arabia has repeatedly called on

rival producers to improve compliance, saying it was the most

paramount immediate task before OPEC+ embarks on releasing more

barrels from December.

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