S&P excludes Kashagan from rating factors for Kazakhstan because of failure of terms

International rating agency Standard & Poors (S&P) has excluded the Kashagan oil project from the factors that are taken into account when building forecasts of economic growth in Kazakhstan, due to repeated postponements of launch date of the giant field, deputy director of the group "Public Finance" of S&P Karen Vartapetov reported.

The production at Kashagan was stopped in September 2013, two weeks after its start because of a gas leak. Almost immediately after the resumption of the production in October 2013 another leak was discovered. The analysis revealed the presence of numerous micro-cracks in the pipeline that appeared due to exposure of associated gas with a high sulfur content to the metal. In April 2014, the operator of the project, consortium North Caspian Operating Co (NCOC), reaffirmed the need for total replacement of the gas and oil pipelines from the field, the total length of which was about 200 km. The Government expects the resumption of the production at the end of 2016.