...

Compensation for Kazakh Field Project Defined as $5bln

Oil&Gas Materials 14 January 2008 19:15 (UTC +04:00)
Compensation for Kazakh Field Project Defined as $5bln

Kazakhstan, 14 January /corr Trend K.Konirova / The project in the Kashagan field development in Kazakhstan, which was earlier led by the Italian company Eni, will have a new operator, the Kazakhstan Government said.

Sauat Minbayev, the Kazakh Minister for Energy and Mineral Resources, said on 14 January that, strictly speaking, the operator is replaced in the project. It will be the first new operating company.

The new company will be established with the representatives of all participants in the project. Eni, an Italian company, will remain the operator of the project in the first stage, which involves test exploration, the minister said. Further the operatorship can be transferred to a company with larger opportunities

An agreement was also achieved to increase the stake of the Kazakh national company KazMunayGas 16.8% from the current 8.33% through other big shareholders of Kashagan. All the rest of the shareholders of the project - ENI, Total, Shell and ExxonMobil will hold 16.8% stake each.

The foreign companies also agreed to pay Kazakhstan $5bln in compensation for adjourning the term of field development from 2010 to 2011 (the final term of commencement of production will be defined in March 2008). However, these funds are considered as a on-time paymemt. If sides make a decision on the payment of compensation during the efficiency term of the project covering the period by 2041, this sum can increase to $20bln with the consideration of the state of the market, Minbayev said.

Along with Eni and KazMunayGas the consortium also includes ExxonMobil, Shell, ConocoPhillips and Inpex.

The Kashagan field located in the north of the Caspian Sea was opened in 2000 and is one of

the huge fields in the world with estimated reserves comprising 4.8bln tons

Latest

Latest