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Caspian Pipeline Consortium

Kazakhstan Fast-Tracks Delivery of Caspian Pipeline Equipment

Kazakhstan has expedited the delivery of two new offshore berthing facilities for the Caspian Pipeline Consortium (CPC), a move prompted by recent drone attacks on CPC infrastructure. The initiative aims to restore the stability of oil exports and ensure uninterrupted operations at the key marine terminal in Novorossiysk. The two new remote mooring devices (RMDs) were procured from a manufacturer in the United Arab Emirates for installation at the CPC Marine Terminal. Kazakhstan’s Energy Minister Yerlan Akkenzhenov announced on December 15 in Astana that the delivery timeline has been moved up from April 2026 to January 2025. “The Ministry of Energy of the Republic of Kazakhstan and the national oil and gas company KazMunayGas are making every effort to deliver the two new RMD units. We are now pushing ahead with this and plan to deliver them in January,” said Akkenzhenov, highlighting the logistical complexity of transporting the technologically advanced equipment to Novorossiysk. According to the CPC press service, the two devices being replaced, CPC-1 and CPC-2, were originally commissioned in 2001. The contract for their replacement was signed in January 2024, and both new units are expected to be completed by December 2025. These upgrades are part of a recovery program following a series of attacks on CPC infrastructure. At the same time, repair work continues on VPU-3, another remote berthing facility. However, efforts have been hindered by severe weather conditions in Novorossiysk, where strong winds and currents have disrupted underwater installation work. “The weather in Novorossiysk is difficult, with very strong winds causing high waves and currents. Divers are descending under the dome to install underwater hoses,” Akkenzhenov explained. The Caspian Pipeline Consortium remains one of the largest energy projects in the post-Soviet space. The 1,511 kilometer Tengiz-Novorossiysk pipeline transports more than two-thirds of Kazakhstan’s oil exports, along with output from Russian fields, including those in the Caspian Sea. The CPC’s marine terminal in Novorossiysk is equipped with three remote mooring devices, enabling tankers to load safely offshore and ensuring continuous export operations. Since autumn 2025, CPC facilities have been repeatedly targeted. The first attack occurred on September 24, when drones struck the consortium’s office, injuring employees and bystanders. Other key incidents included attacks on the Kropotkinskaya base (February 17 and March 24), the Kavkazskaya facility (March 19), and the Novorossiysk marine terminal (September 24-25). The most serious incident occurred on November 29, when the terminal’s pier was damaged, rendering VPU-2 inoperable. Kazakhstan’s Ministry of Energy estimated losses of 480,000 tons of oil and condemned the attack as “unacceptable and dangerous for global energy security.” The emergency acquisition and fast-tracked delivery of the new berthing units are seen as a strategic investment by Kazakhstan, not only to secure its export capacity but also to reinforce the stability of one of the region’s most critical energy corridors.

oil export

Kazakhstan Looks to Reduce Dependence on Russian Oil Transit Routes

Escalating drone attacks on Russian infrastructure amid the ongoing war in Ukraine, including key facilities in Novorossiysk and the Orenburg region, are compelling Kazakhstan to accelerate its search for alternative oil export routes. In this context, the Caspian Pipeline Consortium (CPC), which transits Russian territory, is increasingly viewed as an unreliable option for transporting the country’s crude oil. In November, damage to the VPU-2 single-point mooring at the Yuzhnaya Ozereyevka terminal near Novorossiysk disrupted operations. Only VPU-1 remains functional, while VPU-3 is undergoing scheduled maintenance. As a result, CPC oil shipments have dropped. The pipeline accounts for over 80% of Kazakhstan’s oil exports, more than 1% of global production. The Kazakh Ministry of Energy clarified that exports were not fully halted and that efforts are underway to reroute shipments. First Kashagan Oil Shipment to China via Atasu-Alashankou On December 8, Reuters reported that Kazakhstan would begin exporting oil from the Kashagan field directly to China for the first time via the Atasu-Alashankou pipeline. The route, which leads to Xinjiang, has previously been used for other fields but not for Kashagan. According to the report, Kazakhstan plans to export 50,000 tons of crude oil through this channel. Of that, the Chinese oil company, China National Petroleum Corporation (CNPC), will receive approximately 30,000 tons, while Japan’s Inpex will take 20,000 tons. Although the pipeline’s annual capacity is around 10 million tons, it has been operating below capacity, averaging 85,000-86,000 tons per month. The Kazakh government had initially planned to ship 1 million tons via this pipeline in 2025, less than the 1.2 million tons exported in 2024. In the first ten months of 2025, shipments reached 858,000 tons, according to industry sources. Kashagan is among Kazakhstan’s most strategic assets and one of the largest oil and gas fields discovered globally in the past 40 years. Operated by the NCOC consortium, which includes ExxonMobil, Shell, TotalEnergies, CNPC, Inpex, and KazMunayGas, the field produces more than 15 million tons of oil annually. Until now, nearly all of this was transported via the CPC. Redirecting Oil Amid Infrastructure Damage On December 10, KazTransOil, the national oil pipeline operator, announced that it had redirected oil exports from the CPC system to alternative routes. In December 2025 alone, an additional 360,000 tons of oil are expected to be exported to Russia (via Samara), China, and across the Caspian Sea. Increases in exports from the original plan include: Atyrau-Samara pipeline: +232,000 tons; To China: +72,000 tons; and through the port of Aktau to the Baku-Tbilisi-Ceyhan (BTC) pipeline: +58,000 tons. KazTransOil has also stated it will allow oil companies to temporarily store oil at its tank farm. This would enable greater flexibility in shipment scheduling, optimize pipeline operations, and help maintain uninterrupted deliveries. Rail transport is also being considered to further diversify logistics. In 2024, Kazakhstan exported 54.9 million tons of oil through the CPC. Additional exports included 8.8 million tons via the Atyrau-Samara pipeline, 3.6 million tons via Aktau, and 1.2 million tons to China via Atasu-Alashankou. The BTC...

Caspian Pipeline Consortium

Protecting Critical Infrastructure: Lessons from the CPC Drone Attack

The attack by naval drones on the infrastructure of the Caspian Pipeline Consortium (CPC) on 29 November was an alarming signal, not only for Kazakhstan but for the global energy sector. The temporary suspension of shipments and the shift to operating through a single remote mooring facility struck at the heart of Kazakhstan’s economy. Around 80% of Kazakhstan’s oil exports – generating roughly 40% of its export revenues – pass through the CPC, which has handled over 60 million tons of crude annually in recent years. The vulnerability of CPC infrastructure serves as a reminder of how tightly global energy security is intertwined with regional conflicts. The consortium not only carries Kazakh crude; it also plays a stabilizing role for several international stakeholders, including European refiners and multinational shareholders, such as Chevron and ExxonMobil. Any prolonged disruption would reverberate across global markets, raising transport premiums, tightening supplies in Southern Europe, and undermining confidence in the safety of trans-Eurasian energy routes. For a world already grappling with supply shocks, the Novorossiysk incident underscored how the effects from a single strike can ripple far beyond the immediate impact zone. At the same time, the incident revealed a broader and more urgent issue. Military operations are not supposed to target civilian infrastructure, particularly when it belongs to neutral third parties uninvolved in the conflict. While international humanitarian law (IHL) explicitly prohibits attacks on such facilities unless they are being used for military purposes, the reality on the ground is far less clear-cut. In contemporary conflicts, the line between civilian and military use can blur quickly, creating space for competing interpretations and contested justifications. The Legal Grey Zone of Modern Warfare Although the legal framework is clear on paper, its practical application has become increasingly strained in recent conflicts. The increasing use of drones, long-range precision munitions, and cyber tools has blurred the distinction between civilian and military infrastructure and has outpaced the mechanisms designed to protect them. Energy pipelines, ports, and terminal facilities - which once lay far from the frontlines - can now be struck at minimal cost and with limited attribution. This technological shift has opened a grey zone that existing IHL was never designed to manage, heightening the urgency for clearer norms and enforcement tools. The real challenge lies not in the absence of legal norms but in the lack of mechanisms to enforce them, particularly in cases where neutral countries’ assets become collateral damage. There is, therefore, an argument for the introduction of a new international legal framework – or supplementing existing provisions via a UN protocol – to safeguard critical infrastructure. This is especially relevant in an era of precision weapons and drone warfare, where pipelines, energy terminals, and logistics hubs increasingly fall within potential strike zones. Yet the implementation of such a framework faces complications. Under existing IHL, dual-use infrastructure, such as pipelines that may carry resources for both civilian and military use, can be deemed legitimate military targets. Ukrainian officials have justified strikes on Russian energy...

Caspian Pipeline Consortium

Why Attacks on the Caspian Pipeline Consortium Could Alter Kazakhstan’s Strategic Plans

Attacks on the infrastructure of the Caspian Pipeline Consortium (CPC), reduced export flows, and volatility in commodity markets are generating serious pressures for Kazakhstan. In the coming years, both the country’s financial system and its domestic political balance may face significant tests. A number of experts warn that disruptions in oil logistics via the CPC, which remains the main artery for Kazakh crude exports, could depress budget revenues, strain national companies, and worsen the sovereign outlook. Kazakhstan pumps roughly 80% of its oil exports through the CPC system, and oil revenues account for more than half of the country’s total export earnings. Because CPC Blend is Kazakhstan’s primary export-grade crude, even short interruptions can reverberate through the state budget, the National Fund, and the balance sheets of national companies. This could trigger a domino effect, destabilizing broad swathes of the economy and undermining public finances. Already, the recent rounds of disruption around Black Sea oil shipping are eroding a substantial source of tax revenue for the state. Continued Risk of Strikes Political scientist Dosym Satpaev argues that Kazakhstan may be underestimating the intensity and persistence of the conflict surrounding Ukraine. He contends that both sides in that conflict have used strikes on energy infrastructure as key tools, a tactic that will likely continue. The recent strike targeted the CPC’s single-point moorings (SPMs) at Novorossiysk, a coastal terminal on the Russian Black Sea. These offshore loading points sit in relatively shallow waters and are physically exposed, making them susceptible to the naval drones Ukraine has increasingly deployed against Russian maritime infrastructure. Although the attack officially targeted Russian facilities, the collateral implications for Kazakh oil exports were immediate. According to Satpaev, that means further risks for the CPC. The fact that Kazakhstan remains heavily dependent on this single pipeline reflects a broader failure to diversify exports and reduce reliance on raw material transit. The vulnerability is magnified by the CPC’s ownership structure: although Kazakhstan relies on it for most of its exports, the pipeline network and the Novorossiysk terminal lie on Russian territory and operate under Russian regulatory oversight. Russia holds a majority stake in the consortium, while U.S. firms such as Chevron and Exxon also have significant shares, creating a complex web of interests that limits Astana’s room for manoeuvre. Kazakhstan has already experienced how this dependence can be leveraged. In 2022, Russian regulators repeatedly halted CPC operations over alleged “environmental violations,” moves widely interpreted as political pressure at a moment of diplomatic friction. That precedent underscores how strategic vulnerability to CPC disruptions predates the current wave of attacks. Satpaev is skeptical that alternative export routes, such as via pipelines through the Caspian Sea to Baku-Tbilisi-Ceyhan or transit to China, can substitute for the CPC in the near term. Given the global trend toward reduced oil demand, he believes this leaves Kazakhstan exposed to long-term structural risks. At the same time, Satpaev views as unlikely the possibility that Ukraine would attempt to directly stop the CPC’s operations, given the broader consequences such...

U.S. Sanctions

U.S. Eases Sanctions on Key Kazakh Oil Projects

The Caspian Pipeline Consortium (CPC), oil producer Tengizchevroil (TCO), and the Karachaganak field have been granted permission to resume services and conduct transactions related to their operational activities, following a United States Treasury Department decision to ease sanctions. The Tengiz and Karachaganak fields are located in Kazakhstan, and Kazakh oil is exported through the CPC system. In October, the U.S. Treasury added Russian oil giants Lukoil and Rosneft, along with 34 of their subsidiaries, to its latest package of sanctions. However, experts now suggest that the exemption of key projects in Kazakhstan could have a stabilizing effect on the country's oil sector and its broader economy. The U.S. Treasury’s Office of Foreign Assets Control (OFAC) issued General License No. 124B, allowing services and other transactions required to maintain the operations of the CPC, Tengizchevroil, and the Karachaganak project, even when sanctioned entities such as Lukoil and Rosneft are involved. The license does not permit any transactions related to the sale or transfer of shares in these projects. Kazakhstan’s Minister of Energy, Yerlan Akkenzhenov, confirmed on November 12 that the government is working to have the Karachaganak field fully exempt from the U.S. sanctions regime. The CPC system links oil fields in western Kazakhstan and parts of Russia with a marine terminal in Novorossiysk on Russia’s Black Sea coast. It remains the main export route for Kazakh oil, carrying more than 80% of the country’s crude. The system has an annual capacity of about 83 million tons. CPC shareholders include Kazakhstan, holding a combined 20.75% through KazMunayGas (19%) and Kazakhstan Pipeline Ventures LLC (1.75%). Other shareholders include Chevron Caspian Pipeline Consortium Company (15%), Lukoil International GmbH (12.5%), Mobil Caspian Pipeline Company (7.5%), Rosneft-Shell Caspian Ventures Limited (7.5%), BG Overseas Holdings Limited (2%), Eni International N.A. N.V. (2%), and Oryx Caspian Pipeline LLC (1.75%). The Russian government and Transneft also hold significant stakes. Tengizchevroil LLP, the operator of the Tengiz field, is a joint venture between Chevron (50%), ExxonMobil Kazakhstan Ventures Inc. (25%), KazMunayGas (20%), and Lukoil (5%). Tengiz is one of Kazakhstan’s largest oil fields, with reserves estimated at 3.1 billion tons. The Karachaganak field is among the world’s largest, with development carried out by the Karachaganak Petroleum Operating consortium. Shell and Eni serve as joint operators, and the partnership also includes Chevron (18%), Lukoil (13.5%), and KazMunayGas (10%). On November 13, it was reported that KazMunayGas is considering acquiring Lukoil’s stake in the Karachaganak project, reflecting efforts to manage shifting ownership dynamics under the sanctions environment.

Energy Sector

Pipelines Under Pressure: Ukraine War Hits Kazakhstan Energy Arteries

The ongoing war between Ukraine and Russia continues to have indirect but notable implications for Kazakhstan’s energy sector. Following the September drone attack in Russia’s Novorossiysk that damaged the offices of the Caspian Pipeline Consortium (CPC) - which exports the majority of Kazakhstan’s oil - another incident has raised concern: the October 19 strike on Russia’s Orenburg Gas Processing Plant, which handles gas from Kazakhstan’s Karachaganak field. The CPC confirmed that its export terminal continued operating after the September 24 incident, though two employees were injured and part of its office complex was damaged. The consortium remains the backbone of Kazakhstan’s oil exports, handling over 80% of national crude shipments to world markets. This concentration has long been viewed as a vulnerability because nearly all flows depend on infrastructure inside Russian territory. The war has underscored that risk, prompting Astana to accelerate plans for alternative routes across the Caspian Sea toward Azerbaijan and Georgia. Astana has been working with Baku and Tbilisi to expand capacity along the Trans-Caspian International Transport Route (Middle Corridor), supported by EU and World Bank funding commitments. Kazakhstan’s Ministry of Energy confirmed that the plant, located about 150 kilometers northwest of Kazakhstan’s Karachaganak field across the Russian border, was temporarily shut down following the UAV strike. “According to information from PJSC Gazprom, on October 19, 2025, an emergency situation occurred at the Orenburg gas processing plant as a result of a UAV attack, in connection with which the plant temporarily stopped receiving raw gas from the Karachaganak field.” The Ministry added that gas supplies to domestic consumers remain unaffected and that consultations are underway with field operators to assess potential disruptions and losses. No details on the extent of the damage or repair timelines have been released by the Russian side. Ukraine’s military confirmed responsibility for the attack as part of its campaign against Russian energy infrastructure, according to statements reported by Interfax-Ukraine and Ukrainska Pravda. Industry analysts, however, remain cautious. Journalist Oleg Chervinsky noted that the Orenburg plant processes up to nine billion cubic meters of Karachaganak gas annually, a portion of which is returned to Kazakhstan’s northern regions. He warned that a prolonged shutdown could lead to supply shortages, particularly during the winter months. The timing of the Orenburg attack - just before the start of the heating season - adds a seasonal risk dimension. Olzhas Baidildinov, an expert in the energy sector, criticized delays in constructing a domestic gas processing facility at Karachaganak, arguing that reliance on foreign infrastructure heightens Kazakhstan’s vulnerability to regional conflict and economic disruptions. The replacement of damaged equipment, including components from France’s Technip, could also be complicated by sanctions and supply chain issues, ultimately impacting tariffs and consumer costs. The cumulative effect of reduced gas processing capacity and potential production slowdowns at Karachaganak could weigh on Kazakhstan’s already strained budget. While some observers note that reduced output may help the country align with its OPEC+ production commitments, previously exceeded at major fields including Kashagan, Tengiz, and Karachaganak, such...