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Inpex Says Kashagan Oil Field Delayed by Two Years to 2013

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Inpex Says Kashagan Oil Field Delayed by Two Years to 2013 

By Dinakar Sethuraman

July 10 (Bloomberg) — Crude-oil production at the Kashagan project in Kazakhstan, one of the largest discoveries in the last three decades, may be delayed by two years to 2013, Inpex Holdings Inc. said.

“It’s more realistic to expect Kashagan production to start in 2013,” Chief Operating Officer Katsujiro Kida told investors in Singapore yesterday. Inpex, Japan’s biggest oil explorer, said it has an 8.33 percent stake in Kashagan.

Inpex may spend 1.24 trillion yen ($11.5 billion) in the three years through March 2011. It is counting on Kashagan and liquefied natural gas projects in Australia and Indonesia to boost output to the equivalent of 700,000 barrels of oil a day between 2015 and 2020 from 423,000 barrels of oil equivalent now.

Eni SpA, Italy’s biggest oil company, and other partners developing Kashagan may start production before a 2013 deadline agreed with the government, Chief Executive Officer Paolo Scaroni said at the World Petroleum Congress in Madrid on July 2.

Eni, Kashagan’s operator, and its partners including Exxon Mobil Corp., Royal Dutch Shell Plc and Total SA signed a memorandum with the government on June 28 delaying production at the project for the fourth time until Oct. 1, 2013, according to a statement on the government’s Web site.

Output, originally scheduled to begin in 2005, will reach 370,000 barrels a day about a year after production starts. It will rise to a peak of about 1.5 million barrels a day, according to Eni.

To contact the reporter on this story: Dinakar Sethuraman in Singapore at[email protected].

Last Updated: July 10, 2008 01:25 EDT

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