Change of management in KPO

It means that Karachaganak project passes to the next higher stage of its development. The third phase of field development begins.

The change of power at Karachaganak was expected. The point is that as per the agreement between the four alliance world oil companies - British Gas, ENI/Agip, Lukoil, ChevronTexaco only two companies - British Gas and ENI/Agip that have the biggest share in the project - 32.5% - have a right to manage the project. And the management is carried out in turn. In the very beginning, right after the signing of FPSA the project was managed by a representative of Italian company. Afterwards he was replaced by a Brit John Morrow, who managed the second phase of the field development project.

According to analysts it is the most difficult phase. In total the project is divided into four parts, with the length of 40 years. The first phase consisted mainly of organisational moments, FPSA signing and an acclimatisation of foreigners including mental one.

With whom to agree and on which bases - it's a big school. Since January 1998 the second phase started, about which we are talking. During this period wells were drilled and capital workover carried out. The foreigners observe that they have managed to get clear with the sad past of the field. Non-operating wells, the territory full of waste made the field look grim for many years. Moreover, the environment was being polluted, project developers had to pay huge amounts of fines, because they didn't manage to bring the territory into order. Local officials found a good source of incomes in it. Each beginning, whether it's big or small, requires time and patience. But, as representatives of the Ministry of Energy and Mineral Resources observed recently, there have not been any PSA, concluded by the government of Kazakhstan with foreign companies that would be annulled or aggravate the situation of our country. It means that foreign companies highly estimate our riches.

We already wrote that during the realisation of second phase around 4 billion USD were invested in Karachaganak. If we consider that the cost of whole Karachaganak project is evaluated in 10 billion dollars, nearly a half was spent during that period. From which we can judge its importance.

Facilities, built in the last four years on the project territory, will allow to operate the field in the most efficient manner. Karachaganak Processing Complex refining liquids up to 7 million tons per annum, a gas reinjection rig for 5 billion cubic meters per annum, a pipeline Karachaganak-Atyrau-CPC will provide a possibility to produce and export hydrocarbons to the world market. IN total the production of hydrocarbons will reach 9 million tons per annum.

KAzakhstani authorities deem it a good luck that the project management was carried out not only by a professional oilman, businessman, but simply a tactful, responsive person. West Kazakhstan oblast residents felt it, where huge funds were spent for the construction of social facilities. And in the last two or three years unique social and cultural facilities were built here.

This week an official ceremony of seeing John Morrow, KPO director general, off, who had been replaced by Paolo Campelli, ENI/Agip representative, took place.

The activities of Morrow were highly estimated by the head of our state, who awarded him with "Kurmet" order during his recent visit to Karachaganak. Morrow has an experience of work at world fields, as he had said in an interview to our newspaper, he had been lucky to work in a project on Northern Sea. And nevertheless Karachaganak with its specific features is a new phase in his biography, as well as in the destiny of Kazakhstan. With regard to co-operation with local authorities, he did not conceal the fact that he had several disagreements with the oblast akim. However, Morrow tactfully stressed that they never got into conflicts.

The new KPO director general Paolo Campelli is characterised as a professinal oil worker and a good organiser. He has got more than 20 years of work experience in ENI/Agip. During his career he occupied various high engineering and managing positions. Before his appointment to the new position, Paolo worked as Karachaganak asset manager in the geological survey and production department of his company. Being a chemical engineer, he published several technical articles on deep offshore operations and registered a patent.

Together with Campelli a new KPO production director Cameron Crawford replacing Mario Becherucci was presented. According to the KPO PR department, Crawford has a nearly 30-year old experience in oil & gas. He occupied the highest managerial positions in oil & gas production and processing. Before his appointment to the new position, Cameron had been the general manager of BG E&P India Ltd. And managed the operations of Mukta-Panna oil field and gas field Tapti, on a shelf near Mumbai. Cameron is a member of the Institute of Gas Industry Engineers and he has МBА degree in Strathclyde University (Great Britain).

Welcoming his colleagues, Morrow expressed his certainty, "that they will bring a rich experience, skills and leading qualities, necessary for the management of Karachaganak project and the solution of its current problems".

The change of authority, as we already noted, means a passage to the third phase. It suggests an increase of condensate production to 12 million tons per annum and an installment of additional facilities for the processing of 5 to 10 billion cubic meters of the associated gas. The main thing on this phase is the realisation of Gas project, to which Kazakhstani authorities lay big hopes. The work on this issue has already started. Today the feasibility study is developed, with which an American company "Kellog, Brown and Ruth" is charged. According to specialists, 70% of all gas plants in the world have been built according to projects of this company and therefore national specialists have to listen to the foreign professionals.

Today the issue of locating the gas project is resolved. The company managers recently visited West Kazakhstan to survey suggested sites for the gas refinery construction. Two sites are suggested - Karachaganak field itself, where it would be convenient to locate the plant, besides local authorities offer a territory in 60 kilometres away from the field, near Algabas station. It is still unknown where the plant will be constructed. The former top management of KPO abstains from comments on the gas project, discussed by Kazakhstani officials, referring to the lack of knowledge of all its parameters due to the big volume of works on the second phase of the project.

Now the new KPO general manager Campelli is going to estimate this project. It will be his work that he will have to do together with our authorities.