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Sources say that Kazakhstan's Tengiz Oil Field will remain closed for 7-10 more days.

Three industry sources have said that oil production in Kazakhstan's vast Tengiz field, which is one of the largest in the world, may be stopped for 7-10 days after it shut down on Sunday. This would cut crude exports through the Caspian Pipeline Consortium.

Tengizchevroil, the operator of Tengiz-Korolevskoye Field, announced on Monday that production had been halted due to problems with power supply.

According to KazMunayGas, the state-owned KazMunayGas, a fire had broken out on January 18 at two turbine transformers located at GTES-4, the power station for this field.

One source stated that "TCO's production is down until the end of the week but this could continue until February."

Three sources said that, due to the incident?TCO already cancelled five cargoes totaling 600,000-700,000.00 metric tons of CPC Blend crude scheduled to be shipped out from CPC's terminal at Black Sea in January and Feb.

Chevron, the largest shareholder of TCO, did not respond immediately to a comment request. Sources spoke on condition of anonymity.

TCO's press service responded to an inquiry Tuesday by confirming that production has temporarily been suspended at?Tengiz & Korolevskoye, as a "precautionary measure". They did not specify the cause of fire or when production will resume.

Source: Other producers are raising output.

One source familiar with the data stated that the fall in Tengiz's oil production has not yet affected Kazakhstan’s overall production, as other producers have increased their extraction.

Kazakhstan's crude oil production dropped by 35% between December and the first 12 days in January due to restrictions on CPC exports.

According to the source, the output of two huge Caspian fields, Kashagan & Karachaganak began to increase rapidly in the days following.

Kashagan's average daily production increased by 28% to 197,000 barrels between January 1-12 and January 1-19, while Karachaganak saw a 21% increase to 156,000 barrels. Tengiz's production increased by 6% in the period to 360,000 barrels a day.

The press offices of Karachaganak Petroleum Operating, and NCOC did not reply to requests for comments.

The source stated that "NCOC, KPO and CPC are partially compensating the Tengiz shut down. But in a few days CPC will start to reduce throughput."

Kazakhstan exports the majority of its oil through CPC. However, due to damage at the marine terminal located in Yuzhnaya Ozereyevka to the infrastructure, some crude is redirected into the Baku-Tbilisi Ceyhan (BTC), and then to Germany via Druzhba.

ExxonMobil, KazMunayGas, and Lukoil are also project partners. KazMunayGas holds 20% of TCO while ExxonMobil has 25%. (reporters in MOSCOW; additional reporting by Robert Harvey, LONDON. Editing by Guy Faulconbridge & Jan Harvey).

(source: Reuters)