Kazakhstan’s Tengiz oil field nears restart as power system is restored

(Bloomberg) – Kazakhstan’s largest oil producer is preparing to resume output at the giant Tengiz field, a further step to normalize the nation’s supply to global markets after a series of disruptions in recent months.

The safe restart of the power supply system at the Tengiz field has been confirmed and the facility “will be operational shortly,” Kazakhstan’s Energy Ministry said in a statement on Monday. Tengizchevroil, the operator of the field, “has been tasked with maximizing the restoration of production,” the ministry added. 

Setbacks to oil flows from OPEC+ member Kazakhstan tightened the European crude market, offering short-term support to benchmark prices. Tengizchevroil, which accounts for almost half of the nation’s total production, stopped pumping oil a week ago as a precautionary measure after two fires at power generators. As a result, the country’s daily output is set to average just 1 million to 1.1 million barrels this month, compared with a typical 1.8 million barrels, according to JPMorgan estimates. 

At the same time, a backlog at the Caspian Pipeline Consortium terminal on Russia’s Black Sea coast — a key export route for 80% of Kazakhstan’s exports — is easing as repairs at one of its offshore moorings were completed over the weekend and crude is now being loaded from two jetties.

“The fulfillment of oil shippers’ requests in accordance with annual plans is guaranteed with the simultaneous operation of at least two moorings,” the operator said in a statement on Sunday. 

The Black Sea terminal had been working at reduced capacity since late November, when one out of three moorings was severely damaged by a boat drone, while the other one was undergoing planned maintenance. Kazakhstan blamed Ukraine for the attack, something Kyiv did not deny.

Loadings were also disrupted several times in December and January amid storm season in the Black Sea.