Saipem gets $1.8 billion Kashagan contract

The North Caspian Operating Co. (NCOC) awarded Saipem a $1.8 billion engineering and construction contract to build two pipelines for the Kashagan field project, offshore Kazakhstan

The Kashagan giant field extends over a surface area of approximately 75km by 45km and is located in the Kazakh waters of the Caspian Sea, about 80km southeast of Atyrau, in some 4200m of water.

Upon the terms of the agreement, Saipem will construct two 95km pipelines, which will connect D island in the Caspian Sea to the Karabatan onshore plant in Kazakhstan. Construction is expected to be complete by end of 2016.

Saipem’s scope of work includes engineering, welding materials, conversion and the preparation of vessels, dredging, installation, burial and the pre-commissioning of the two pipelines.

According to Saipem, each of the two pipelines has a 28 inch diameter and are made of carbon steel. They are internally cladded with a corrosion resistant alloy layer, and will each have an offshore length of about 65km out of the total 95km.

The Kashagan field will be developed in two phases. Phase I, the experimental program, is already in the construction phase. Phase II is in the initial design phase and further phases are still under concept selection.

Kashagan’s reserves are estimated at some 35 billion bbl and 52Tcf of gas. The NCOC consortium operates the Kashagan field, and is comprised of Italy’s Eni, ExxonMobil, Shell, France’s Total, and Kazakh state oil company KazMunayGas, each with 16.8 percent, along with Japan’s Inpex (7.6 percent) and China National Petroleum Corp. (8.3 percent).