Kazakhstan will Comply with Promised Oil Output Cuts as Giant Kashagan Field Shuts
Kazakhstan will shut production at its giant Kashagan oil field next month, bringing its production into compliance for the six months of the promised cuts under the OPEC/non-OPEC supply accord, energy minister Kanat Bozumbayev said Sunday.
The average production over the six months will meet the commitment, as Kazakhstan will reduce output more than promised in March, April and May, Bozumbayev told reporters in Baku, Azerbaijan, where he will attend Monday’s OPEC/non-OPEC monitoring committee meeting. Output in March will average 1.82 million b/d, and fall to below 1.8 million b/d in April, he said.
The Central Asian country has to date exceeded its production quota of 1.86 million b/d under the deal, which covers the first six months of 2019, primarily due to rising output at Kashagan.
“Output there is currently between 300,000 and 350,000 b/d, so it will be a significant cut, almost 200,000 b/d,” Bozumbayev said. “We expect that in April and May we will have a low output level, then in June it will pick up and so our average output for the six months will be less than 1.8 million b/d.”
Last week Kazakhstan’s energy ministry reported daily liquids output of 1.893 million b/d in February and 1.885 million b/d in January.
Bozumbayev added that a decision on whether Kazakhstan will join the monitoring committee may be taken at the next full meeting of the OPEC/non-OPEC coalition April 17-18 in Vienna.
The six-country committee is currently co-chaired by ministers from Saudi Arabia and Russia, and also includes Kuwait, Algeria, Venezuela and Oman. It is tasked with monitoring market conditions and assessing compliance with the supply cuts, as well as making recommendations to the wider OPEC/non-OPEC coalition.
“They proposed this to us, but [confirming new committee members] would happen at the general meeting, which will take place only in April,” Bozumbayev said, adding that it was not Kazakhstan’s idea, but the country is open to joining the committee if other participants are amenable.
