A group of oil companies led by Chevron and Kazakhstan plan a $36.8 billion plan to boost production in the Central Asian country. Bobbi Rebell reports.
Kazakhstan and a group of oil companies led by Chevron are investing $37 billion to expand the country's Tengiz field. The plan will increase output to 850,000 barrels per day by 2022. It's a big economic bet on the future - capitalizing on lower building costs now, to be better positioned when the market improves, and oil prices rebound. Tony Headrick, analyst at CHS Hedging. (SOUNDBITE VIA SKYPE) ANTHONY HEADRICK, ENERGY ANALYST, CHS HEDGING, (ENGLISH) SAYING: "Within this low cost-type environment, meaning that the steel prices are low, and the, essentially, labor is relatively low, it is, likely, a good opportunity for Chevron and the others to proactively invest in a field and a location that has proven itself historically." Other stakeholders in the venture include Exxon Mobil and Lukoil. David Gaffen manages energy sector coverage for Reuters. (SOUNDBITE) DAVID GAFFEN, ENERGY MARKETS EDITOR, REUTERS, (ENGLISH) SAYING: "It is sort of an example of investing in a time when the price is somewhat lower, and trying to make a return on that later." At its peak, Tengiz output will be roughly the same as the current oil production of Britain. It is Kazakhstan's main export.