Kashagan not getting back on line in 2014

Following the start of production from the Kashagan field on 11 September 2013, the operations had to be stopped on 24 September, due to a gas leak in the onshore section of the gas pipeline running from D Island to the onshore processing facility “Bolashak”.

The pipeline’s pools were supplied by two Japanese companies, Sumitomo and JFE, while the Italian company Saipem was contracted for laying the pipes.

Pipeline rehabilitation

After the pipeline incidents in October, dedicated task-forces were established to assess all issues and consequences involving experts from NCSPSA Consortium partners, the Agent companies and the Operator. Investigations were launched to identify the scope of the issues: the oil and the gas pipelines were inspected from inside using Intelligent Pipeline Inspection Gauges (so called ‘Intelligent PIGs’). Two PIG campaigns were completed for each pipeline, which took more than 100 days of operations, followed by the analysis and interpretation of the raw data captured in these trials.

Additional investigations are carried out to inspect the pipelines from the outside. 47 km of the onshore part of the pipelines were excavated for inspection, and 970 welds were inspected by means of non-destructive testing (ultrasound). Similarly, an inspection campaign of the pipeline segments offshore was started in March 2014 and is expected to be finalised in May. Overall the works involved more than 500 people.

Another set of investigations aimed to identify the root cause of the incidents that resulted in the leakages. Material experts at three independent laboratories (Technical Welding Institute (TWI), UK; Center of Materials Development (CSM), Italy; Institut Français de la Corrosion (France)) were mobilised to analyse samples of the damaged pipeline and develop a concise root cause analysis.

In parallel, studies were conducted to identify potential production restart scenarios.

Results of the investigation

The immediate cause of the pipeline failures was traced by material experts to be sulphide stress cracking (SSC) due to unexpected locally elevated hardness in tiny areas of the steel.

Laboratory analyses and simulations of the operational environment with samples from the pipeline concluded that the specifications for the pipeline were appropriate for the conditions of the Kashagan field. The specifications meet the requirements of the NACE standards (National Association of Corrosion Engineers), respective ISO standards, and best practices in international oil and gas field development. As was previously communicated, the gas and oil pipeline was designed to withstand the expected H2S content and the presence of water.

The inspections by the Intelligent PIG indicated potential cracks at the welds of the pipeline spools as well as on some at the pipeline bodies. Some of these indications were later confirmed by non destructive tests..

Conclusion and way forward
The current assessment, based on investigation results to date, is that both oil and gas lines might have to be fully replaced, which assessment requires to be confirmed once the ongoing investigation is completed. The Operator is now developing a full replacement plan, which is expected to be finalized by mid-2014.

The plan includes tenders to select contractors, deciding on the material specifications and incorporating the availability of key equipment. The intention is to develop an optimized plan to replace the lines taking into account any potential for early production restart. As a precautionary measure, to avoid losing time, the Consortium has already initiated the tender process for the purchase of pipeline joints.

The restart of production will depend on the results of the investigation which are due by the end of Q2, but production is not expected to resume in 2014.

The North Caspian Sea PSA Consortium remains committed to ensuring operations are conducted in a safe manner and meet the requirements of international good oil field practice, the NCSPSA, and applicable legislation, the consortium said in a press release.

Partners in the field are Total 16.81%, Eni 16.81%, Shell 16.81%, ExxonMobil 16.81%, KazMunayGas 16.81%, CNPC 8.4% et Inpex 7.56%.

Most expensive energy project

The stakeholders have reportedly splashed $50 billion on development of the field, discovered in 2013, but according to CNN Money, Kashagan is the world’s most expensive energy project valued at $116 billion.
Located 80 kilometers off the coast of Kazakhstan, the Kashagan site lies in the Northern area of the Caspian Sea. Water depths range from 2 to 6 meters, and temperatures fluctuate between -40°C and +40°C throughout the year.

To protect the installations from enormous drifting slabs of ice, 11 million tons of rock were extracted from Kazakh quarries to build giant dikes.

The shallowness of the water – only 2 to 6 meters – ruled out the use of traditional platforms, so a unique solution had to be found. This involved building an artificial island 1.7 kilometers long for the processing units and a number of smaller satellite islands for the production wells.

The Kashagan field represents the largest oil accumulation in the North Caspian Sea with estimated reserves of approximately 35 billion barrels of oil in place.