Kashagan project produces first oil

Bloomberg

Kashagan, the biggest crude discovery in the last 40 years, has produced its first oil after eight years of delays and costs that reached $48 billion, more than double early estimates.

The start of output means the Caspian Sea project has narrowly beaten an Oct. 1 deadline that Kazakh Energy Minister Sauat Mynbayev set in 2008, saying the partners risked losing “tens of billions of dollars” in compensation for costs if they missed it.

Expenses had mounted as the operators undertook drilling from a man-made island to unlock crude 4,200 meters under the seabed in a pressurized reservoir with a high concentration of lethal sour gas.