Caspian oilfield is Big Oil's new energy frontier

By Maria Golovnina

KASHAGAN, Kazakhstan (Reuters) - Face wrapped in a thick scarf against clouds of blinding dust, the electrician gazed at a maze of pipes and pumps teeming with 15,000 workers and said his work was like building the Tower of Babel.

He was speaking casually. But for the oil industry Kashagan, the world's biggest discovery since 1968 with reserves locked amid lethal, high-pressure gases beneath the north Caspian Sea, is a challenge of biblical proportions.

"There are people from 30 different countries working here," said electrician Leonid, asking not to be identified because he was not authorized to speak to the media. "But we do try to find a common language."

Kashagan, developed by oil majors including Eni and Exxon Mobil, represents all the challenges Western countries face to secure energy supplies as Asia becomes more energy-hungry and Russia seeks to dominate resources on its borders.

The field's difficult geology, remote location, harsh climate and environmental challenges make it one of the world's most complex and, at $136 billion so far, expensive energy projects.

As state-owned companies now control most global reserves, Kashagan shows how Western majors, which once dominated the industry, now have to take what chances they can to produce oil.

With an estimated 9 billion barrels of recoverable oil in the Central Asian state of Kazakhstan, Kashagan is, like the tower in the Bible story, an almighty undertaking.

In temperature swings from minus 40 to plus 40 degrees Celsius, the oil in the Kazakh field is heavy in sulphur -- a hazard to health and the environment.