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Kazakhstan plans to raise oil exports to China as of mid-2020

Kazakhstan plans to reverse its Kenkiyak-Atyrau oil pipeline to boost oil exports to China from around 1 Mt/year to 6-7 Mt/year starting from the second half of 2020. The pipeline is currently shipping crude oil westward from the Kenkiyak oil field to the Atyrau terminal on the Caspian Sea for exports to Europe.

Kazakhstan's crude oil exports to China have collapsed from their 2013 peak of 11.8 Mt to 1.3 Mt in 2018, due to declining output in oil fields located in the northwest and the south of the country. Many of these fields are operated by Chinese companies, which supply a large part of the oil used by the Shymkent and Pavlodar refineries, leaving limited oil volumes for exports. Reversing the Kenkiyak-Atyrau pipeline would link more small- and medium-sized oil fields in western Kazakhstan to the refineries and free up the same volumes of crude oil from southern and northwestern Kazakhstan to exports in China.

Reversing the pipeline would also reduce shipments through Transneft's pipeline network and could reduce some oil flows to Europe. However, European customers should still benefit from the oil production of the giant Kashagan, Tengiz and Karachaganak projects run by Western majors.