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Kazakhstan to receive $3.3-5 billion from shares in Karachaganak in 2012-2037

Oil&Gas Materials 4 September 2012 14:17 (UTC +04:00)
“Kazakhstan will get about $3.3 - 5 billion from its share in the project to develop the Karachaganak major oil and gas fields, during 2012-2037, or from $1.4 to 2 billion in the form of discounted cash flows of KMG with forecasted oil price of $ 85 per barrel,” the Ministry of Oil and gas of Kazakhstan said.

Kazakhstan, Astana, Sept 4 /Trend D.Mukhtarov/

"Kazakhstan will get about $3.3 - 5 billion from its share in the project to develop the Karachaganak major oil and gas fields, during 2012-2037, or from $1.4 to 2 billion in the form of discounted cash flows of KMG with forecasted oil price of $ 85 per barrel," the Ministry of Oil and gas of Kazakhstan said.

According to the ministry's calculations, if the price increases, this amount will increase accordingly. In general, according to the ministry of oil and gas, with the launch of the Karachaganak project, net income will be close to $21 billion with Kazakhstan's share of about 64 per cent (after deducting actual costs incurred).

"That is, Kazakhstan will have received about $13 billion, including $9 billion in taxes and $4.1 billion in the form of a share of the hydrocarbons profit," the ministry said.

The volume of produced material from Karachaganak is only about 10 per cent of the total estimated reserves. Some 114 million tons of liquid hydrocarbons and about 136 billion cubic meters of gas have been produced since the beginning of the project in January 2012.

In 2011, total production from the field reached 12 million tons of oil and 17 billion cubic meters of gas, which is six and nine per cent more respectively compared to the previous year.

The national company KazMunaiGas has become a full participant in the further development of Karachaganak since the summer of 2012. As a result of the deal, the BG Group owns a 29.25 per cent stake in the project (before it was 32.5 per cent), Eni - 29.25 per cent (32.5 per cent), Chevron - 18 per cent (20 per cent), Lukoil - 13.5 per cent (15 per cent previously) and KazMunaiGas - 10 per cent.

The Karachaganak oil and gas field is situated in the West Kazakhstan region with impressive reserves. According to geologists, there are more than 1.2 billion tons of 'black gold' and condensate and over 1.35 trillion cubic meters of 'blue fuel'.

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