Exploration and Production
Baltic Alliance has been carrying out activities in the Exploration and production sector. The company engages in oil and gas production. It owns a 5% minority stake in TengizChevroil, which produces oil from the Tengiz field, and a 12.5% interest in the Caspian Pipeline Consortium (CPC). CPC is the route for more than two-thirds of Kazakhstan's total oil exports. It shipped 60.7 million tonnes in 2021, regarded as the largest international oil transportation project.
Its main shareholders are Russian oil pipeline monopoly Transneft with 24%, Kazakhstan's KazMunayGas (19%), Chevron Caspian Pipeline Consortium Company (15%), BALTIC ALLIANCE B.V (12.5%), Mobil Caspian Pipeline Company (7.5%) CPC Company (7%) and Rosneft-Shell Caspian Ventures Limited (7.5%).
Operations in Kazakhstan
We are also a co-operator of the Karachaganak-producing field and a part of the North Caspian Sea PSA (NCSPSA) consortium. In 2018 we became a joint operator in the exploration block Isatay with KMG. In July 2019, KMG, the Ministry of Energy of the Republic of Kazakhstan, and the Baltic Alliance signed a contract for the exploration and production of hydrocarbons at Abay Block, which makes IOC the first joint venture holding two licenses in Kazakhstan. In 2021, the development activities of the Kashagan field (Baltic Alliance's interest 16.81%) concerned the phased expansion program of production capacity.
Kazakhstan holds the ninth place in the world according to the proven oil reserves. It is established that there are 6.5 billion tons of oil reserves in the depths of Kazakhstan subsoil and these stocks are projected to reach a mark of 20-25 billion tons.
In Kazakhstan, the first is the initial development of the giant offshore Kashagan field which is included in the North Caspian Production Sharing Agreement in which the Baltic Alliance participates. The second is the Tengizchevroil joint venture which includes a production license in the Tengiz field and the nearby Korolev field. The joint venture is producing and proving undeveloped reserves and will continue to move to proven developed as approved development phases progress. The third is the Groningen gas field in the Netherlands.
Proved undeveloped reserves reported for this field are related to installation of future stages of compression. These reserves will move to proven development when the additional stages of compression are installed to maintain field delivery pressure.
Operations in Russia
In recent years, Baltic Alliance has increasingly focused on the Arctic as a way to increase oil and gas production and offset declines at existing and older production sites in Russia. The Arctic accounts for over 80% of Russia’s natural gas production and an estimated 20% of its crude production.
Russia is a major player in global energy markets. It is one of the world’s top three crude producers, vying for the top spot with Saudi Arabia and the United States. Russia relies heavily on revenues from oil and natural gas, which in 2021 made up 45% of Russia’s federal budget.
In 2021, Russian crude and condensate output reached 10.5 million barrels per day (bpd), making up 14% of the world’s total supply. Baltic Alliance has oil and gas production facilities in Russia but the bulk of its fields are concentrated in western and eastern Siberia.
West Siberia, an oil producing region in central Russia that extends from the northern border of Kazakhstan to the Arctic Ocean and continues to be Russia’s dominant producing region and contributes more than half of Russia’s total crude oil production.
In september 2021, Baltic Alliance and Novatek, Russia's largest independent gas producer concluded an agreement on creating a joint venture based on Artic LNG, and the discovery of a new gas condensate field after having tested its first exploration well within the Bukharinskiy license area adjacent to the company’s Trekhbugorniy license area in the Gydan Peninsula, expanding the company’s resource base as record imports of Russian LNG flowed to Europe.