CPC Pipeline

Fluor and its partner Giprovostokneft were engaged as an engineering, procurement, and construction management (EPC) contractor by the Caspian Pipeline Consortium (CPC). The $3.2 billion CPC Crude Oil Pipeline System stretches 1,700-kilometer pipeline from Tengiz, Kazakhstan to a deep-water marine terminal on the Black Sea at Novorossiysk, Russia.

Fluor provided front-end engineering, including detailed design, procurement of critical long-lead materials and equipment. Fluor also provided program management to coordinate the EPC activities being performed by other companies. During the first of five construction phases on the CPC Pipeline., the initial construction phase included 5 pump stations, 929 miles of pipe, a tank farm, and various telecommunication systems.

The construction workforce peaked at 6,000 personnel, with the majority of workers being local Russian and Kazakhstani employed and trained. The Team had worked almost 3 million hours without a lost-accident, a significant safety achievement.

The pipeline became operational in October 2001, with completion of the initial phase construction in October 2002.

Fluor provided program management and front-end engineering and design during the first of five construction phases on the CPC Pipeline. Crude oil flows through the $3.2 billion, 1,700-kilometer pipeline from Tengiz, Kazakhstan to a deepwater marine terminal on the Black Sea at Novorossiysk, Russia.

Client's Challenge

The Caspian Pipeline Consortium (CPC) comprised the Governments of the Russian Federation, Republic of Kazakhstan, and Sultanate of Oman, plus the oil / gas companies ChevronTexaco, LukArco, ExxonMobil, Rosneft-Shell, Agip, British Gas, Oryx, and Kazakhstan Pipeline Ventures.

Phase 1 involved refurbishing a 753-kilometer segment of pipeline; constructing 740 kilometers of 40- and 42-inch diameter pipeline and two pump stations; and refurbishing/upgrading three pump stations. The project scope also included construction of a marine terminal for loading 300,000-ton tankers.

The route crossed several hundred rivers and canals, including the 1.5 kilometers-wide Volga River. The tank farm contained four 100,000-cubic-meter tanks, the largest in Russia at the time.

Ecosystems were studied to identify rare plant and animal species and methods determined for their protection. The State Committee of the Russian Federation and regional environmental agencies approved all environmental aspects of the project. In addition, all design, construction, and operational solutions of the pipeline system had to conform to the most stringent standards set by the European Union, the World Bank, the European Bank of Reconstruction and Development, and other international organizations.

Fluor's Solution

CPC is a unitary pipeline transport system to export crude oil. Fluor refurbished 466 miles of the pipeline and replaced a crossing at the environmentally sensitive Volga River with a horizontal directional drill crossing. Construction involved 457 miles of new segments, three new pump stations with associated tankage, refurbishment / upgrade of two pump stations, construction of a marine terminal, and installation of new SCADA and telecommunications for the entire pipeline/terminal system.

In addition, in a joint effort with CPC, Fluor managed procurement, expediting, and logistical control of $336 million in Client-furnished materials and equipment and $1.14 billion of Client-direct field subcontracts.

Fluor's 5,000 experienced personnel and 200 contractors, located in seven offices and at seven sites, worked together effectively to execute this large, complex project.

The project staff also donated time, resources and funding for various organizations where assistance was needed. The employees selected several orphanages, schools, senior housing institutions, and hospitals that would be beneficiaries of the giving. The project team was engaged to improving the lives of their local community.

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Conclusion

The international workforce included representatives of oil and gas design institutes in Russia and Kazakhstan. Fluor, as program manager, provided language and cross-cultural training to optimize the collaboration of engineers. To further improve communication, Fluor established an Internet site where the globally dispersed project members could connect.

The Fluor safety program was instrumental in bringing about a project-wide incident rating of a low 0.25 incidents per 200,000 labor hours.

The remaining stages of construction, to increase the capacity of the pipeline incrementally by adding pump stations along the route, will occur in four stages over the next several years.