Fluor's Success in Kazakhstan: A Boon for Energy Infrastructure and Local Economy

Fluor Corporation, a leading global engineering, procurement, and construction (EPC) company, has successfully led a joint venture that supported the completion and startup of Tengizchevroil’s (TCO) Future Growth Project (FGP) at the Tengiz oil field in Kazakhstan. The Fluor-led joint venture, which included partners Worley, Kazakh Institute of Oil and Gas, and KazGiproNefteTrans Engineering Company, has been providing a comprehensive suite of engineering, procurement, construction, operations, and maintenance services for TCO since 2011. The completion of this project marks a significant milestone for Fluor's Energy Solutions business and demonstrates the company's capability to execute complex, large-scale international energy infrastructure projects.

The Tengiz oil field, discovered in 1979, ranks as one of the world's largest and deepest fields. The new Third-Generation Plant (3GP) built as part of the FGP marks the beginning of a ramp-up in crude oil production over the coming months. Once all Tengiz facilities are operating at full capacity, TCO's total annual crude oil production is expected to reach approximately 40 million tons per annum. This significant increase in production capacity will have a substantial impact on Kazakhstan's economy and energy sector.

As part of its work on the project, Fluor has made significant contributions to building a sustainable economic future for residents in the region. The company has developed programs for schools and universities to train craft labor and professional engineers, as well as new capabilities for the Republic of Kazakhstan in engineering, high-tech equipment servicing, project management, construction, and fabrication. These initiatives not only support the local economy but also foster long-term growth and development in the country.

Tengizchevroil LLP, the Kazakhstani partnership that owns the Tengiz oil field, is owned by Chevron (50%), KazMunayGas (20%), ExxonMobil (25%), and Lukoil (5%). The successful completion of the FGP is a testament to the collaboration and partnership between Fluor and these major energy companies.



The successful completion of the FGP at the Tengiz oil field is expected to have both short-term and long-term impacts on Fluor's financial performance. In the short term, the project has been a significant revenue contributor to Fluor's annual revenue of $16.3 billion. With the project now complete, Fluor may see a reduction in associated revenue streams from construction activities. However, the company has mentioned "operations and maintenance services," which suggests potential for ongoing revenue from the production phase. In the long term, Fluor's successful execution of the FGP in a logistically challenging environment reinforces its market position as a leading EPC contractor capable of delivering on massive, technically complex energy projects. This achievement strengthens Fluor's credentials in managing complex energy infrastructure projects globally, potentially enhancing its competitive position for similar projects worldwide.



Operating in Kazakhstan, particularly in the oil and gas industry, exposes Fluor to potential geopolitical risks. These risks include political instability and regime change, regulatory changes and nationalism, geopolitical tensions, and environmental concerns and activism. To mitigate these risks, Fluor should maintain strong relationships with local partners, monitor political developments, and ensure compliance with environmental regulations and local community engagement initiatives.

Fluor's commitment to local workforce development and economic sustainability in Kazakhstan positions the company favorably for future opportunities in the region. The company's long-term presence in Kazakhstan and its track record of successful project execution can enhance its reputation and competitive position, making it a preferred partner for future energy infrastructure projects in the region. Additionally, Fluor's investment in local capabilities and capacity can lead to long-term benefits, such as reduced recruitment and training costs, and stronger relationships with local communities and stakeholders.

In conclusion, Fluor's successful completion of the Future Growth Project at the Tengiz oil field in Kazakhstan is a significant achievement for the company and a boon for the local economy. The project's completion not only enhances Fluor's market position and reputation but also contributes to Kazakhstan's energy sector and economic development. As Tengizchevroil ramps up production, Fluor is well-positioned to capitalize on future opportunities in the region, provided it effectively manages geopolitical risks and maintains its commitment to local workforce development and economic sustainability.