Kashagan Oil Field, Kazakhstan

Description
The giant Kazakhstani oilfield, Kashagan, is one of the world’s biggest oil finds and the ‘biggest oil discovery’ of recent times [1]. With the start of the project being delayed for 13 years (now the start date has been moved to 2016) due to several environment, legal, and investment-associated complications, it is also ‘the world’s most expensive standalone project’ [2]. Despite such a grand amount of complications, the NCOC (North Caspian Operating Company, a consortium of international companies including Eni, Exxon Mobil, Royal Dutch Shell, Total, CNPC (China) and Inpex(Japan) [1] is not giving up attempts to extract the vast deposits of the oilfield. The case history of Kashagan involves numerous conflicts, public hearings, as well as court cases. One of the major conflicts has been the impact of the oil field on the health of the local populations as well as on the fragile environment of the area.
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Basic Data
NameKashagan Oil Field, Kazakhstan
CountryKazakhstan
ProvinceAtirauskaya Oblast
SiteAtirau
Accuracy of LocationHIGH local level
Source of Conflict
Type of Conflict (1st level)Fossil Fuels and Climate Justice/Energy
Type of Conflict (2nd level)Oil and gas exploration and extraction
Wetlands and coastal zone management
Specific CommoditiesCrude oil
Natural Gas
Project Details and Actors
Project Details
-Total deposits are estimated to be 35 billion barrels of oil, with 11 billion labeled as 'recoverable'.
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Project Area (in hectares)337500
Level of Investment (in USD)137,000,000,000.00
Type of PopulationUnknown
Potential Affected Population150,000-200,000
Start Date21/08/2007
Company Names or State EnterprisesExxonMobil Corporation from United States of America
Eni group from Italy
Royal Dutch Shell from Netherlands
KazMunaiGaz (KMG) from Kazakhstan
INPEX Corporation from Japan
Total SA from France
China National Petroleum Corporation (CNPC ) from China
Relevant government actorsThe Government of Kazakhstan:

-Kazakhstan Environment Protection Ministry

- Atirau Regional Administration as represented by Bakhtikozha Izmukhambetov

-Ministry of Gas and Oil of Kazakhstan
International and Financial InstitutionsEuropean Bank for Reconstruction and Development (EBRD)
Environmental justice organisations and other supportersInternational NGOs:

Crude Accountability

Friends of the Earth

Local NGOs:

Globus

Jayik Caspian Aarhus Centre

Local ecologists and geologists
The Conflict and the Mobilization
Intensity of Conflict (at highest level)LOW (some local organising)
When did the mobilization beginIn REACTION to the implementation (during construction or operation)
Groups MobilizingFishermen
Indigenous groups or traditional communities
International ejos
Local ejos
Neighbours/citizens/communities
Women
Local scientists/professionals
Forms of MobilizationCreation of alternative reports/knowledge
Development of a network/collective action
Development of alternative proposals
Involvement of national and international NGOs
Lawsuits, court cases, judicial activism
Impacts
Environmental ImpactsVisible: Air pollution, Biodiversity loss (wildlife, agro-diversity), Surface water pollution / Decreasing water (physico-chemical, biological) quality
Potential: Genetic contamination, Loss of landscape/aesthetic degradation, Soil contamination, Waste overflow, Oil spills, Large-scale disturbance of hydro and geological systems
Health ImpactsPotential: Accidents, Exposure to unknown or uncertain complex risks (radiation, etc…), Mental problems including stress, depression and suicide, Occupational disease and accidents
Socio-economic ImpactsPotential: Loss of livelihood, Violations of human rights
Outcome
Project StatusUnder construction
Pathways for conflict outcome / responseCourt decision (victory for environmental justice)
Technical solutions to improve resource supply/quality/distribution
Under negotiation
Development of AlternativesCrude Accountability: an urge to financial institutions and banks to stop further financing of the project

As published on the Ifri Report:

-a call for independently-assessed expert report about the damage done to the area

-to absolutely halt flaring gas at Kashagan

-to come up with an ecologically friendly solution to the problem of storage, disposal, and management of sulfur at the site

-before the project goes on, great attention and an independently conducted expert study shall assess the risks and consequences to the health of the local population

-the resulting socio-economic situation shall be independently assessed and local people shall be compensated for the damage done to their environment and livelihood.
Do you consider this as a success?No
Why? Explain briefly.The extraction of oil was indeed stopped, but it is due to technical complications and an accident with pipes, not environmental concerns. And after the problem is fixed, the project will be continued.

The consortium has largely ignored the requests made my NGOs and local activists to provide more information about the damage caused, the potential damage and potential solutions and compensations.

They have created jobs and built some infrastructure, but as locals report those are low level entry jobs and infrastructure cannot be adequately used (such as a school whereas there is no transportation to the school).
Sources and Materials
Links

[1] Link to the article that describes shift of the start date to 2016 and has basic info about companies involved:
[click to view]

[2] Article explaining financial complications of Kashagan:
[click to view]

[3] NGO Crude Accountability summary of environmental and health concerns:
[click to view]

[5] An article about an open meeting with local population and their voiced environmental and health concerns:
[click to view]

[6] An article about environmental damage of 2013 and the legal implications of it:
[click to view]

[8] Kazakhstan President’s words are quoted from here:
[click to view]

Companies that have stakes in the Kashagan project:
[click to view]

More information about institutions financing the loans to corporations involved at Kashagan:
[click to view]

Some more info about Kashagan project:
[click to view]

Some more info about Kashagan project:
[click to view]

Companies that have stakes in the Kashagan project:
[click to view]

[7] A report published by CEE Bankwatch about Kashagan that contains more detailed info about environmental impact, economic and political conditions and NGO work:
[click to view]

Media Links

Kashagan. One of the artificial islands built to extract the oil
[click to view]

Other Documents

[4] Ifri (French Insitute for International Relations) assessment report on Kashagan:
[click to view]

Meta Information
ContributorYevgeniya Yatsenko, MICLA McGill University, [email protected]
Last update01/10/2014
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