November 11, 2023 [Upstream]- The EU is already a major market for Kazakhstan oil and gas, with the Central Asian nation’s output accounting for the majority of its €29.8 billion ($32 billion at current exchange rates) total exports to the bloc in 2022, according to EU figures.
Kazakhstan also recently increased crude deliveries to Germany, after state-controlled oil pipeline operator Kaztransoil upgraded a legacy export pipeline link to the Russian oil transmission network used to carry its crude onwards to Europe.
In the latest development, Hungary’s Foreign Minister Peter Szijjarto said during a visit to the Kazakh capital of Astana last week that his country is set to import more than 4.6 million barrels of Kazakh crude before end of this year.
However, it will not be sent via the Russia route being used to carry Kazakh crude to Germany.
Instead, the crude will sent through its legacy Atyrau–Samara pipeline link to the Russian Black Sea port of Novorossiysk, which also hosts the marine terminal used to export Kazakh crude transported by the Caspian PIpeline from its three major foreign-led developments — Tengiz, Kashagan and Karachaganak.
From Novorossiysk, the Kazakh crude will be sent by sea to Croatia’s Omisalj receiving terminal on the island of Krk, and from there through the Adria pipeline that can be used to deliver oil to Hungary, Slovenia and Bosnia.
Representatives of Kazakh state oil and gas company KazMunayGaz were due to travel to Croatia earlier in October to “familiarise themselves with the capabilities of the Omisalj oil terminal”, according to the Kazakh Foreign Ministry.
Szijjarto described the Kazakhstan deal as another breakthrough in his government’s efforts to “guarantee Hungary’s safe energy supply”.
Russia remains the main suppier of crude to Hungary, which was granted, alongside Slovakia, an exemption from EU sanctions against Moscow because its energy infrastructure was based on a Soviet-era network relying on Russian supplies.
Hungary continues to import Russian oil via the Druzhba pipeline, which crosses Belarus, Ukraine and Slovakia before entering the country, and is expected to continue importing Russian crude after the Kazakh agreement is introduced.
The Kazakh oil imports “do not mean that the (Hungarian) government wants to replace an already existing source with another one. It does mean that the country can use energy supplies from as many sources as possible,” Szijjarto said in a video address on social media.
“Kazakhstan can be a very serious source of our energy supply and its role will increase,” he added.
Szijjarto also said that, after “15 long years of preparation”, Hungary’s MOL, together with KazMunayGaz and China’s Sinopec, will start natural gas production from the Rozhkovskoye field Kazakhstan.
Located in the west of the country, Rozhkovskoye holds estimated recoverable reserves of almost 27 billion cubic metres of gas and about 95 million barrels of condensate.
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