U.S. says it will help develop Kazakh Aktau port

The United States yesterday said it would help Kazakhstan develop its Caspian sea port of Aktau, which will be the starting point for oil tankers shipping Kazakh crude to the planned U.S. backed Baku-Ceyhan pipeline. Stephen Sestanovich, special adviser to the U.S. Secretary of State, told reporters in the Kazakh capital of Astana that the $3.0 billion project linking Azeri capital Baku to Ceyhan in Turkey remained on track.

"We are happy to see the interest which the government of Kazakhstan is showing towards this project," Sestanovich said after meeting with Prime Minister Kasymzhomart Tokayev. "Today we discussed the question of transporting Kazakh oil from Aktau and it is possible the project will soon be called Aktau-Baku-Tbilisi-Ceyhan," Sestanovich said, speaking through an interpreter.

A joint statement released after the talks said the two sides had agreed to work together to improve transport infrastructure in Western Kazakhstan and to ease the export of Kazakh crude to other seaports. It did not elaborate. Several U.S. companies including Chevron and ExxonMobil are active in Kazakhstan.

The United States, which is keen to limit Russian and Iranian influence in the Caspian area has long pushed for a pipeline to Turkey - a route which would bypass both its rivals. Energy analysts say the project is unfeasible because of its cost which is double that of a pipeline crossing south to Iran.

The race hotted up after an international consortium discovered oil off the Kazakh Caspian shelf earlier this year. Kazakh government officials said the site could be one of the world's largest offshore oilfields. Kazakhstan, which suffers from a lack of viable export outlets for its oil has
said it will give equal priority to all potential pipelines. The first project to come on line is a $2.0 billion link to the Russian Black Sea port of Novorossissk which will be complete in mid-2001 but Sestanovich said the pipeline would not affect work on Baku-Ceyhan.

Kazakhstan will produce 34 million tonnes of oil this year, but output is expected to rise significantly once the offshore Kashagan field comes on line after 2004. Currently just 3.5 million tonnes of crude are moved by tanker from Aktau annually.