BP Accelerates Plans To Tap Ustyurt Reserves, Fuels Talk Of Trans-Caspian Route

BP is positioning itself as a key player in developing substantial energy deposits beneath the Ustyurt Plateau, a region that stretches across parts of western Kazakhstan and southern Uzbekistan, and officials and analysts say that could revive plans for a pipeline beneath the Caspian Sea to carry gas toward Europe.

The company’s Kazakh subsidiary signed an exploration agreement on April 2 with the national oil company KazMunayGaz to survey a promising tract on the Kazakh side of Ustyurt. Kazakh officials framed the renewed collaboration as a platform for joint projects, while BP has reportedly held parallel discussions with Uzbek officials about joining forces with Uzbekneftegaz and Azerbaijan’s state oil firm to commercialize discoveries there.

Ties between Uzbekistan and Azerbaijan date to a 2025 production-sharing pact that covers at least 1,000 square kilometers—about 386 square miles—of the Ustyurt zone. Since then, Tashkent’s leadership has publicly said prospecting turned up a significant gas accumulation, and the effort to bring BP into the venture suggests the early results were more than promising to local authorities.

On the Kazakh side, state-linked reporting and company briefings disclosed a major deposit in the Zhylyoi District, north of Ustyurt, announced the same day. Officials likened the find in scale to the country’s largest offshore project, noting that because the new discovery lies on land, development could require a smaller capital outlay. They put the size of the resource at more than 20 billion metric tons of hydrocarbons.

Those statements have fiscal implications. The production-sharing framework used at Kashagan saw foreign partners provide the bulk of investment and left the Kazakh treasury with a relatively small slice of export proceeds. Officials in Astana have signaled they want any new agreements governing Zhylyoi or Ustyurt to deliver a larger share of the returns to the state, a shift that could reshape how future deals are structured in the country.

Interest in a trans-Caspian export route has cropped up alongside the exploration news. A report in an Azerbaijani outlet cited a BP geologist in Baku saying the company is weighing a corridor that would route gas from Kazakhstan and neighboring producers through Azerbaijan and onward to Europe via the Southern Gas Corridor. A regional energy analyst, speaking on condition of anonymity, said such a push would face political, regulatory and environmental hurdles—among them unresolved Caspian maritime legal questions and the need for new multilateral financing—but could also reduce Europe’s reliance on other suppliers and bring new revenue to transit states. Local communities, they added, could see an uptick in jobs and public investment if the projects move ahead, though timelines would likely span years.