The Chinarevskoye Field
Our main asset
Nostrum has a 100% owned top-to-tail infrastructure footprint in the resource rich pre-Caspian basin in North-western Kazakhstan. The Company currently owns four licences, all located within a 120km radius of its substantial processing facilities.
Nostrum’s current producing asset is the Chinarevskoye field – a 274km2 licence located to the north of Uralsk, near to the Russian border. The Chinarevskoye licence is comprised of a 185km2 production and 89km2 exploration licence.
Despite recent operational setbacks, Nostrum will continue to try to extract as many hydrocarbons as possible from our licence areas. We still see the potential for our fields to produce for many years to come, and we are still opening up new areas after more than ten years of drilling at Chinarevskoye.
During 2018 Nostrum made an application to the state authorities to extend its production licence to cover the full extent of its licence area following the exploration success of well 40 during 2017-18. For this purpose, changes were approved to the mining allotment in the Northern area of the field which will be reflected in a supplemental agreement to the PSA once the production project has been amended.
boe produced since 2007
Stable business environment
Exploration and production licence
Nostrum was first granted an exploration and production licence for the Chinarevskoye field in May 1997. The current production licence granted in 2008 covers 185km2, with validity to 2032 for the North-eastern Tournaisian reservoir, and until 2033 for all other oil and gas bearing reservoirs and horizons.
Production Sharing Agreement (PSA)
A grandfathered PSA exists between Nostrum and the Government of Kazakhstan, which specifies the exploration and development boundaries of the Chinarevskoye field. The PSA also addresses the respective royalties, profit share and tax liabilities payable to the government.
The licence and PSA are currently valid until 2032 (with respect to the North-eastern Tournaisian reservoir) and 2033 (for the rest of the Chinarevskoye field), and Nostrum must comply with the terms of the exploration permit, the production permit and the development plans during this period. To date, the Company has met all of its capital investment obligations under the PSA.
Geology reserves and drilling
The Chinarevskoye field is a multi-layer structure with 17 reservoirs and 53 compartments spread over three areas. Commercial hydrocarbons have been found in the Lower Permian, Bashkirian, Bobrikovski, Tournaisian, Mullinski, Ardatovski, and Biyski-Afoninski reservoirs. The company is carrying out an appraisal programme to investigate commerciality of Frasnian reservoir found in well 40 in 2018.
Based on a Ryder Scott report dated 1 January 2019, the proved and probable reserves for the Chinarevskoye field amount to 294 mmboe (2017: 358 mmboe). Proven reserves amount to 98 mmboe (2017: 124 mmboe) and probable reserves to 196 mmboe (2017: 234 mmboe). Oil and condensate amount to 110 mmbbl of proven and probable reserves (2017: 135 mmbbl), LPG to 42 mmbbl (2017: 54 mmbbl) and gas to 142 mmboe (2017: 168 mmboe).
Initial hydrocarbon discoveries at the Chinarevskoye field were made during drilling exploration conducted during the Soviet era. Subsequent to this discovery, there have been 100 wells and side-tracks drilled under the PSA between 2004-2018.
At the Chinarevskoye field 20 oil wells and 25 gas condensate production wells were in operation as at 31 December 2018. Three new gas condensate production wells were brought online in 2018. The first well for production, well 224, drilled in 2018 in a flank position of the Biyski North-east reservoir, encountered water and could not be brought to production. An increased water inflow to other existing wells was also observed on the southern flank of the Biyski structure which resulted in a lower than expected average daily production from this main producing reservoir. In the western area of the field, the multi-frac appraisal well 234 was drilled to planned final depth. However, the multi-fracs could not be performed due to technical issues in the wellbore. Comprehensive technical work is being carried out and will be completed in H1 2019. Therefore, the Company plans to focus on an appraisal drilling programme in H1 2019 in the Northern area of the Chinarevskoye field where well 724 and 40 discoveries were made in 2017 and 2018. The drilling programme will be conducted with two drilling rigs on the Chinarevskoye field. When the results of these appraisal wells are known the Company will be able to decide how best to proceed with the drilling programme for the remainder of the year.
crude oil production wells
gas condensate production wells
wells drilled since 2004
Comprehensive technical work is being carried out and…the Company plans to focus in H1 2019 on an appraisal drilling programme in the Northern area of the Chinarevskoye field.
Our facilities are located in an advantageous geographical position which encourages flexible transportation links for the off-takers of our sales products. The proximity to major international railway lines and oil and gas pipelines allows for convenient transport to markets in Central Asia and Eastern Europe.
Crude oil transportation is provided by a short pipeline completed in 2017 which provides access to the KazTransOil (“KTO”) pipeline for export.
GTU3 was mechanically completed in December 2018. Commissioning of GTU3 is ongoing with first raw gas into the plant expected in 2019.
Oil and stabilised condensate pipeline and railway loading terminal
Since its completion in 2008 and commissioning in 2009, our 120 km liquids pipeline and railway loading terminal located at Rostoshi near Uralsk has been used for the transportation of our crude oil and stabilised condensate. The products travel through the pipeline from the Chinarevskoye field site to the railway loading terminal, where it is first stored and then transported by railcar to final off-takers. The separation between our stabilised liquid condensate and crude oil occurs during transportation through the same pipeline using a “PIG” system. This ensures quality is not compromised as it would be in a multi-purpose pipeline and allows for higher export prices. The maximum throughput of our oil pipeline is three million tonnes per year. The rail loading terminal, which receives the crude oil and condensate, has a capacity of three to four million tonnes per year. Additional infrastructure in use also includes crude oil storage tanks on site and at the rail terminal, condensate tanks on site and at the terminal, and a railcar loading facility at the railway terminal. This terminal allows for 32 railcars to be loaded simultaneously. The first vapour recovery unit in Kazakhstan’s history can also be found at the facility. Forecasted increases in throughput, in line with our strategy to double production, will be accommodated by our existing infrastructure.