ExxonMobil has informed Kazakhstan that the Tengiz oil field, the country's largest, is approaching its production peak and is expected to see a sharp decline in output over the coming decade. According to a corporate presentation reviewed by Bloomberg, production at Tengiz will plateau next year and then drop to approximately 500,000 barrels per day by 2035. This represents a decline of about 40% from peak levels, or potentially a 60% drop, based on the assumption of no major new investments for expansion.
To mitigate this projected decline, ExxonMobil is advocating for joint investments in a new project at the Kashagan field, specifically in its undeveloped western portion. This project, which could produce up to 600,000 barrels per day, would be a joint venture with the state-owned company KazMunayGas. KazMunayGas has reportedly supported ExxonMobil's proposal, though it still requires political approval.
ExxonMobil has previously made it clear that a potential $80 billion joint investment in expanding the Kashagan field is dependent on the resolution of existing disputes. These include long-standing disagreements totaling $150 billion between the Kazakh government and international oil companies, as well as a $5 billion environmental fine. Representatives from Tengizchevroil (the operator of Tengiz), Exxon, and Chevron have declined to comment, while the Kazakh Ministry of Energy and Kashagan operator NCOC have not responded to inquiries. KazMunayGas officially denied Bloomberg's report as inaccurate.
