CPC Announces 2012 Annual Results

January 11, 2013

In 2012 the total CPC System shipment volumes from Tengiz to Novorossiysk reached 33.3 MTA. In spite of some increase in volumes shipped through the Tengiz to Atyrau section, the total volumes shipped through the CPC system were down 2.6% on the year before. The CPC Marine Terminal in Novorossiysk loaded 30.6 MTA, which was 3.8% down on 2011. This volume throughput reduction was due to some objective causes, specifically, a number of scheduled  shutdowns to tie-in new facilities. Throughput numbers for December 2012 were more optimistic, reported to be up 13.1% on December 2011.

The consortium’s tariff revenues remained at the same level as the year before , equalling USD 1.1 bn.

Again CPC demonstrated a high operational availability level of the Base Business system. The CPC Marine Terminal loaded the 300 millionth ton of crude oil since the pipeline system was commissioned. Another important milestone was over 17 million hours without LTI achieved in operations . Many years of sustained operations allowed the CPC Marine Terminal to achieve international recognition. In November 2012 the Terminal was awarded the 3rd Oil Terminal International Award in the 2012 Sustainability nomination.

An important result achieved last year was CPC operations confirming compliance with three key international standards as regards its environmental management system, the occupational health and safety management system and the quality management system.

Progress was achieved on the Expansion project. In Russia the upgrades of the existing facilities and the construction of new facilities are in progress in accordance with a revised schedule. There are some positive trends on the Kazakh section achieved as a result of some modifications made to Project management.  In general the tie-in work to connect additional equipment needed to operate an expanded system and to increase its throughput was completed successfully. The installation of the third SPM at the Marine Terminal was completed.

CPC pipeline system is one of the largest investment projects in the energy industry with participation of foreign capital on the CIS territory. The length of the pipeline connecting the oil fields in Western Kazakhstan with the Marine Terminal near Novorossiysk is 1,511 km. CPC Marine Terminal is equipped with single point moorings which allow for safe tanker lifting at a considerable distance from the shore, also when the weather conditions are unfavorable.
 
The Expansion Project envisages rehabilitation of 5 existing and construction of 10 additional pump stations (2 in the Republic of Kazakhstan and 8 in the Russian Federation), six near Novorossiysk and an SPM at the CPC Marine Terminal to supplement 4 existing crude oil storage tanks. It also includes replacement of a 88 km pipeline section in Kazakhstan with a larger diameter pipe. Total investment in the Project will be US$ 5.4 billion.

CPC Shareholders: Russian Federation (represented by Transneft - 24% and CPC Company - 7%) - 31%; Republic of Kazakhstan (represented by KazMunayGaz  - 19% and Kazakhstan Pipeline Ventures LLC - 1.75%) - 20.75%; Chevron Caspian Pipeline Consortium Company - 15%, LUKARCO B.V. - 12.5%,