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Kazakh pipeline test a success

CHINA secured access to vast oil deposits in west Kazakhstan yesterday after the energy-rich central Asian nation said it had completed the expansion of a major oil pipeline to its eastern neighbor.

The Kazakh company in charge of the project said the first test shipment had been successfully completed through the Kenkiyak-Kumkol pipeline. "The implementation of this project will have tremendous influence on the whole oil and gas industry, providing new opportunities for oil exports," KazStroyService said.

The new link, which starts near the Kenkiyak field operated by China National Petroleum Corp, gives China better access to Kazakhstan's oil provinces in the west.

The first phase of the pipeline, between central Kazakhstan and China's Xinjiang Uygur Autonomous Region, was completed in 2006. The latest link expands the pipeline to Caspian Sea oil fields.

Chinese oil companies such as CNPC own stakes in several Kazakh oil producers, including CNPC-AktobeMunaiGaz, operator of Kenkiyak and Zhanazhol fields, and PetroKazakhstan, which operates the Kumkol group of fields.

Kazakhstan has stepped up contacts with China for fresh investment. China in April agreed to lend it US$10 billion in a "loan-for-oil" deal during Kazakh President Nursultan Nazarbayev's visit.

As part of the deal, CNPC bought a stake in MangistauMunaigas, a company whose fields are also close to the starting point of the extended pipeline.

China and Kazakhstan agreed to build the 3,000-kilometer pipeline in 1997 and have said they would later double the capacity of the combined pipeline from the current 10 million tons a year. China is also building a pipeline to import up to 40 billion cubic meters of central Asian gas a year. The link originates in Turkmenistan and goes through Kazakhstan and Uzbekistan.


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