After spending nearly $50 billion to expand the Tengiz oil field, the American oil giant and its partners face even greater uncertainty.
Tengiz is located in western Kazakhstan. It is home to one of the most fertile oil fields in the world, and has been producing oil for 30 years. In this way, it helps to develop the largest economy in Central Asia - that of Kazakhstan.
It is this field that accounts for a large part of Chevron's revenues - the American oil giant owns 50% of the company that operates Tengiz, known as Tengizchevroil or TKO.
Chevron and Exxon Mobil's involvement in TKO and other projects in Kazakhstan also provides the country, which shares a 4,750-kilometer border with Russia, with an important link to the United States, writes in its analytical material The New York Times.
These relationships are being tested these days, just as Chevron and its partners completed the expansion of Tengiz worth $ 48 billion.
Ukraine recently attacked the main route for exporting oil from Kazakhstan through Russia - a 940-kilometer pipeline that includes flows from the Tengiz field, as part of efforts to limit the revenues of Moscow on energy. Chevron and the Kazakh government are also beginning difficult talks to extend their agreement for the oil field, which expires in 2033.
The talks are important for Chevron, which has built relationships in Kazakhstan for decades and whose free cash flow from Tengiz is likely to be around $4 billion by 2025.
The talks also come at a time when the US oil giant is playing a key role in Venezuela. The company is the largest private oil producer there.
Following the arrest of Nicolas Maduro, President Trump said that the US will “run“ the country and regain US oil interests there. Chevron, which has operated in Venezuela since 1923, said it was trying to ensure the safety of its employees and operations.
The Tengiz agreement with Chevron may be even more important for Kazakhstan, not least because Tengiz has played a significant role since the early 1990s in helping the country build an economic foundation. Kazakhstan became independent in 1991 with the collapse of the Soviet Union.
Oilfields typically decline in yield over time, but Tengiz is far from exhausted. “Where you have big oilfields, they tend to get bigger,“ said Clay Neff, Chevron's president of exploration and production.
According to TCO, the field contains 25 billion barrels of oil. Korolyov, a neighboring field that would be considered very large almost anywhere else in the world, holds another 1.6 billion barrels.
In 2016, the size of the field helped convince Chevron and its partners to embark on one of the largest oil projects ever, drilling new wells and adding giant compressors and other equipment to further boost production.
A decade later, at a cost of about $48 billion - about $11 billion more than initial estimates - the facilities appear to be running smoothly.
Andrew O'Connor, production operations manager at Tengiz, explained that the field has been producing below its potential in the past because its processing facilities were inadequate. “We were limited in our capacity,” he said in an interview in Tengiz. “Now we have increased the capacity of the plants“.
Tengiz is among the world's 10 largest oil fields by production, according to energy consulting firm Wood Mackenzie.
It originated as a reef in a tropical sea more than 300 million years ago. At the time, the area that is now western Kazakhstan was “a magical place,” says James Bishop, a Chevron geoscientist. The oil later migrated into the rocks and was trapped by layers of salt from evaporating seas.
The region, known to geologists as the Caspian Basin, has spawned other giants, including one called Kashagan, which could eventually produce even more oil than Tengiz. “We have big neighbors,“ says Alexey Vysotsky, reservoir management manager at TCO.
Despite the blessing of these resources, Kazakhstan's oil industry faces challenges. Kazakhstan is landlocked. Exports from Tengiz and other fields, including some crude from Russia, are transported through a pipeline that circles the northern edge of the Caspian Sea and reaches the Russian port of Novorossiysk on the Black Sea.
Chevron, a co-owner of the pipeline, and other companies have managed to keep crude flowing during the war in Ukraine. But Ukraine has used drones to attack the pipeline, as well as other Russian energy infrastructure, and in late November managed to disable one of the three tanker loading facilities at the Black Sea port, causing Tengiz output to drop by about 30%.
Last year, higher production levels from Tengiz also created tensions between Kazakhstan and its partners in the OPEC+ oil cartel. But Kazakhstan is unwilling to restrict output by international investors like Chevron or smaller domestic producers. “Kazakhstan has no easy options” to comply with OPEC+, said Craig Saunders, a senior analyst at Wood Mackenzie.
The negotiations to extend the Tengiz agreement are likely to have a more lasting impact than these disputes. In an indication of how important these talks are to both sides, Kazakhstan's President Kassym-Jomart Tokayev met with Chevron CEO Mike Wirth three times in 2025.
“We are entering what I would describe as a good start to the negotiations,“ Mr. Wirth told financial analysts in October.
Tokayev is a seasoned diplomat. He came to power in 2019 after the resignation of the country's longtime leader, Nursultan Nazarbayev, who attracted international oil companies. He now has the difficult task of pleasing those of his constituents who want a better deal without undermining the revenue generated by the projects.
Tengiz plays a huge role in the Kazakh economy, accounting for almost 10% of the country’s gross domestic product, according to S&P Global Commodity Insights, a research firm. TCO is Kazakhstan’s largest oil producer, accounting for more than 40% of the country’s output in the first half of 2025, and is also its largest taxpayer.
“The productivity of a significant segment of Kazakhstan’s economy is at stake,“ writes Matthew J. Sagers, head of Eurasian Energy at S&P Global Commodity Insights.
Some industry experts say it would be difficult to replace the management and technical skills that Chevron brings to Tengiz, which is considered a demanding area due to high pressure and the presence of large amounts of toxic hydrogen sulfide, among other factors.