highlights of operations
Chevron is Kazakhstan’s largest private oil producer holding important stakes in the nation’s two biggest oil-producing projects—the Tengiz and Karachaganak fields.
The Tengiz Field is the world’s deepest operating super-giant oil field, with the top of the reservoir at about 12,000 feet (3,657 m) below ground. Chevron holds a 50 percent interest in Tengizchevroil (TCO), which operates the field. The joint venture is also developing the nearby Korolev Field.
In addition, Chevron holds an 18 percent interest in the Karachaganak Field, Kazakhstan’s second-largest producing petroleum reserve.
Chevron is the largest private shareholder in the Caspian Pipeline Consortium (CPC). The CPC pipeline provides an important export route for crude oil from Tengiz and Karachaganak. The pipeline is undergoing a major expansion.
Chevron also operates a polyethylene pipe plant and a valve plant in Atyrau.
In Kazakhstan, as in any country where Chevron does business, we are a strong supporter of programs that help the community.
exploration and production
Through our subsidiaries, Chevron is involved in two of Kazakhstan’s largest joint ventures: Tengizchevroil (TCO) and Karachaganak Petroleum Operating B.V. (KPO). Net daily production in 2015 from TCO and Karachaganak averaged 311,000 barrels of liquids and 486 million cubic feet of natural gas.
Tengizchevroil looks ahead
TCO is developing the Tengiz and Korolev crude oil fields in western Kazakhstan. Net daily production in 2015 averaged 257,000 barrels of crude oil, 348 million cubic feet of natural gas and 21,000 barrels of natural gas liquids. The majority of TCO’s crude oil production was exported through the CPC pipeline. The balance was exported by rail to Black Sea ports and via the Baku-Tbilisi-Ceyhan Pipeline to the Mediterranean.
In 2015, work continued on three projects:
- The Wellhead Pressure Management Project is designed to maintain production capacity at existing facilities.
- The Capacity and Reliability Project is designed to reduce bottlenecks and increase plant efficiency and reliability at TCO facilities.
- The Future Growth Project is designed to increase total daily production by 250,000 to 300,000 barrels of oil-equivalent and to increase the ultimate recovery of the reservoir.
Fabrication activities for the Capacity and Reliability Project moved forward in 2015. Final investment decisions on the Wellhead Pressure Management Project and the Future Growth Project are expected in mid-2016.
Karachaganak, one of the world’s largest fields
The Karachaganak Field in northwest Kazakhstan is among the world’s largest oil and gas condensate reserves. Development of the field is being done in phases.
In 2015, net daily production at Karachaganak averaged 33,000 barrels of liquids and 138 million cubic feet of natural gas.
Approximately 32,000 net barrels per day of processed liquids were exported and sold at prices available in world markets. Most of the exported volumes were transported through the CPC pipeline. A portion was also exported via the Atyrau-Samara (Russia) pipeline. Liquids not exported via these pipelines were sold as condensate in local and Russian markets.
Moving product to market via the CPC pipeline
Chevron has a 15 percent interest in the 935-mile (1,505-km) CPC crude oil export pipeline that runs from the Tengiz Field in Kazakhstan to the Black Sea port of Novorossiysk, Russia. The pipeline provides a key export route for crude oil produced from TCO and Karachaganak. In 2015, an average of 927,000 barrels of crude oil per day passed through the pipeline, composed of 824,000 barrels from Kazakhstan and 103,000 barrels from Russia.
Work continues on the 670,000-barrel-per-day pipeline capacity expansion project. The project is being implemented in phases, with capacity increasing progressively until reaching a design capacity of 1.4 million barrels per day through the end of 2016. By mid-2015, capacity from Kazakhstan had been increased to 925,000 barrels per day, and the pipeline was handling TCO’s total production. The expansion is expected to accommodate a portion of the future growth in TCO production.
Building on success and diversifying the economy
Chevron is helping Kazakhstan meet its goal to diversify the economy. Since 2003, the company has owned and operated a polyethylene pipe plant in Atyrau. The plant’s eight processing lines have a production capacity of 17,000 tons of polyethylene pipe per year. The plant also produces metal-plastic and thermoplastic pipes used in heating and hot water supply systems. In 2013, Chevron opened another plant in Atyrau that produces up to 30,000 iron gate valves per year. The valves are used in cold water supply, sewage systems and natural gas distribution networks. Both plants are managed and operated by Kazakhstani employees.
The plants bring new technology to Kazakhstan and supply the country with products that are currently imported. In addition, there is potential for export.
marketing and retail
Chevron markets lubricants, coolants and fuel treatments under the Texaco® brand for consumer, commercial and industrial use in Kazakhstan through our authorized distributor.
in the community
In Kazakhstan, Chevron works in partnership with local and national governments, communities, nongovernmental organizations (NGOs), and other institutions on projects focused on health, education and economic development.
Chevron is committed to promoting healthy lifestyles, with a special focus on young people and women.
Chevron promotes HIV/AIDS awareness among youth in Almaty. In 2015, we supported interactive performances—presented at schools and colleges by the Bilim Central Asia Educational Center and the Art and Shock Theater—that told the story of an HIV-infected couple.
Every year, Chevron donates medical equipment to hospitals and maternity centers in Almaty and Astana and supports professional development of health workers. In 2015, we supported training for 150 doctors and nurses from children’s intensive therapy departments of Almaty hospitals. The instruction was aimed at reducing illness and mortality among newborns.
Chevron supports and manages a number of educational development programs in Kazakhstan that reach thousands of youths, teachers and trainers from urban and rural schools. In partnership with local government, education institutions and businesses, Chevron is implementing the Atyrau Youth Development Initiative, a social investment program designed to prepare youth for success in the workplace and the community. More than 20 teachers and 200 young people have benefited from interactive training in life skills and science, technology, engineering and math (STEM) subjects.
Chevron partners with the Begalin Children’s Library and the Balbulak Foundation in Almaty to develop children’s interest in science, technology, engineering, arts and math, or STEAM.
In 2015, in cooperation with the International IT University, Chevron supported Kazakhstan’s first Robocon Games 2015 for schoolchildren. Under the theme Eco City Robots, students and their teachers applied their knowledge and creativity to make robots that could plant trees.
Chevron’s University Partnerships and Association Relations program works with Kazakh National Technical University to provide grants and scholarships for young people seeking advanced professional and technical training. In 2015, Chevron provided scholarships to more than 60 high-achieving graduate and undergraduate students.
Chevron continues to work with students and young researchers from Nazarbayev University in Astana. In 2016, a team of 25 students worked together to conceive and build a 3-D model of a conceptual, energy-efficient “eco settlement” for the Akmola region.
Since 2012, Chevron has supported the NGO Expert Centre at Almaty Management University. Today, the center provides training for more than 100 community and NGO leaders in advocacy, accountability, strategic planning and financial management. In 2015, the university added a master’s degree program for nonprofits.
Chevron continues to maintain strong ties with the Union of Artisans and has helped thousands of artisans across Kazakhstan with design and business skills training. Product quality has improved, access to new markets has expanded and a professional network has been created.
Chevron partners with British Council Kazakhstan to help students of vocational colleges build skills for employment and entrepreneurship. Nearly 400 young people have received training in project management, business planning, budget development and information technology. Participants formed teams to develop and implement social entrepreneurship projects in Almaty.
tengizchevroil and karachaganak: investing in the future
Chevron contributes to the development of communities through its business partnerships in the Tengiz and Karachaganak projects. From 1993 through 2015, TCO invested more than $1.1 billion to fund social projects and programs for the community and employees in Atyrau Oblast. TCO has directed resources to social infrastructure projects, schools, hospitals and clinics and to the construction of water and electric systems.
In health care, TCO partners with the Kazakhstan Association of Family Physicians to reduce cardiovascular disease through prevention programs. In addition, the association trains doctors and nurses in the early detection and effective management of hypertension and other cardiovascular diseases. More than 600 urban and rural doctors have benefited from the program.
In education, TCO has programs whose focus is to increase learning of STEM subjects, promote English and Kazakh language development, and support computer literacy. TCO employees who volunteer their time to these programs benefit by developing skills in teamwork building, communication and public speaking. Volunteers also appreciate the opportunity to expand their understanding of other cultures.
We also work with our Karachaganak partners to support the community. Since 1998, KPO has contributed more than $300 million to social infrastructure projects in western Kazakhstan.
In 2015, KPO completed construction of the Kadir Mirza-Ali Arts Centre in Uralsk, a modern facility for cultural events and programs. Also, KPO started a kindergarten for 290 children in Zhanibek district of West Kazakhstan and has improved roads there.
KPO provides medical treatment and recreation for pensioners living in the villages around Karachaganak. The company also offers scholarship programs and promotes English language development.
record of achievement
For more than two decades, Chevron has worked to develop Kazakhstan’s energy potential and advance its economy. Our investment has been marked by key milestones.
- 1993 – Chevron signed the foundation agreement with the Republic of Kazakhstan that created the joint venture company Tengizchevroil.
- 1996 – A Chevron-branded station opened in Almaty, the first international station in the country.
- 1997 – Chevron entered the Karachaganak Petroleum Operating consortium to develop Karachaganak, one of the world largest oil and gas fields.
- 2001 – The Caspian Pipeline Consortium (CPC) crude oil export pipeline began operations from Tengiz to the Black Sea port of Novorossiysk in Russia.
- 2003 – Chevron started production at the polyethylene pipe plant in Atyrau.
- 2008 – TCO completed the Sour Gas Injection Facilities and Second Generation Plant expansion, nearly doubling daily production of oil and natural gas.
- 2011 – Chevron began producing metal-plastic pipes at its polyethylene pipe plant in Atyrau.
- 2011 – The CPC broke ground on the pipeline capacity expansion project.
- 2012 – TCO founded Kazakhstan’s first maritime academy to train professionals who can work in the oil and gas industry.
- 2013 – Chevron began production of iron gate valves, which are used in water supply, sewage and natural gas transportation systems. The technology used at the newly constructed Atyrau Valve Plant is unique in Kazakhstan and other former Soviet countries.
health, environment and safety
Protecting people and the environment is one of Chevron’s core values.
Tengizchevroil continues to record high marks in standardized industrial safety measurements, such as days away from work. In 2015, more than 30,000 people worked more than 72 million hours for TCO with just eight injuries that required a day away from work. TCO strives for zero workplace injuries and is continuously working to improve its safety record.
Employees at the Atyrau Polyethylene Pipe Plant have worked without a day-away-from-work injury since its earliest days of operation. Plant employees continue to achieve excellent results. The plant has surpassed 1.8 million work-hours—more than 13 years—of incident-free operation.
Chevron has invested heavily in protecting the environment. Since 2000, Tengizchevroil has spent more than $3 billion on measures that have reduced natural gas flaring from its operations by 85 percent. TCO has applied innovative technologies to redirecting gas for its own use, for export to consumers and for reinjection into the reservoir.
Chevron contributes to Kazakhstan’s economy through employee wages, purchases of goods and services from local suppliers, tariffs and fees paid to state-owned companies, and taxes and royalties paid to the government. Since Tengizchevroil’s founding, the company has paid about $112 billion to the Republic of Kazakhstan. In 2015, direct payments to the government totaled $8.2 billion.
From 1993 to 2015, Tengizchevroil spent more than $20 billion on Kazakhstani goods and services—$2.4 billion in 2015 alone.
In 2015, Chevron, together with its Karachaganak partners, awarded contracts worth $581 million to Kazakhstani companies for goods and services. Since 1997, the local content in all partner contracts has totaled $5.4 billion.
Since 1993, the proportion of employees at Tengizchevroil who are Kazakhstani citizens has grown from 50 percent to 86 percent. Kazakhstanis now make up 74 percent of managerial and supervisory positions.
As of the end of 2015, all skilled and clerical positions at the Karachaganak operations and 96 percent of professional and engineering roles were filled by local employees. At the managerial level, 79 percent of positions were filled by local employees.
All managers and staff at Chevron’s polyethylene pipe and valve plants are Kazakhstani citizens. Our plants have created about 205 local jobs, including 110 employee positions.
We use the most up-to-date equipment, technology, methods and expertise in our oil and gas business in Kazakhstan. The company deploys all of its technologies with the goal of increasing reserves and production, accelerating development, and reducing costs. Our Kazakhstani workers are exposed to the latest developments in oil field operations.
Chevron works to enhance the technological capabilities of Kazakhstan’s engineers. In partnership with Kazakhstan’s national oil company, KazMunayGas, we started the Core Analysis Laboratory in Aktau, Mangistau Oblast. Together, we upgraded the lab with technologically advanced equipment and software in 2015.
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