Kazakhstan, Astana, Feb. 4 / Trend D. Mukhtarov /
The issue of Kazakhstan's acquiring ConocoPhillips's share in the Kashagan North Caspian project is being discussed at government level, Kazakh Oil and Gas Minister Sauat Mynbayev said at a press conference in Astana today.
"Kazakhstan has not bought ConocoPhillips's stake in Kashagan," he said. "Currently, an interdepartmental committee continues its work."
Last week, a source at the Kazakh Oil and Gas Ministry told Trend that Kazakhstan will consider the issue of buying ConocoPhillips's share until June 2013. "The state has this right," the source said.
"The ministry is the working body of the commission, that is it prepares all incoming documents and formalises the protocol decisions of the commission," he said. "The Oil and Gas Ministry has an equal right to vote with all other members of the commission in terms of voting."
He also said the Oil and Gas Ministry and an interdepartmental committee still have time to make a final decision.
Earlier, it was reported that on January 25 that a 60 day period had expired during which shareholders of the NCOC international consortium were to use a priority right to purchase ConocoPhillips's shares. Some media outlets reported that all the companies refused to purchase in favour of an Indian company which ConocoPhillips had an agreement on the share sale. The share value was estimated at $5.5 billion.
"The Indian company intended to buy a share at the amount of $5 billion and we still have time to make a decision," the minister said.
As previously reported, at the end of December the managing director of the National Welfare Fund of Kazakhstan Samruk-Kazyna consideing issues of developing KazMunaiGas, Malik Salimgereev said that if they decide to buy a stake in the Kashagan project of ConocoPhillips, Kazakhstan's national oil and gas company KazMunaiGas does not exclude possibility of borrowing on the foreign markets for this purpose.
According to him, an official statement from ConocoPhilips on the sale of its 8.4 - per cent interest in the project was published in late November. According to the procedure, the consortium shareholders have two months to discuss the feasibility of its priority right to purchase that share.
"KazMunaiGas, which is part of the consortium and other shareholders are currently considering the matter," Salimgereev said.
According to him, it is also possible the share of ConocoPhilips may be distributed to shareholders in equal parts.
"In the case of a positive decision, if necessary we (KMG-ca.'s) can take the borrowing in foreign markets to buy this stake," Salimgereev said.
However, Kazakhstan and other shareholders have a priority right to acquire a share of ConocoPhillips in the project, Kazakh Oil and Gas Minister Sauat Mynbayev said.
Kashagan is one of the largest fields discovered in the past 40 years. According to analysts, Kashagan has the potential to unite the top five largest oil companies in the world. Kazakh geologists estimate geological oil reserves of 4.8 billion tons. According to the project operator, total oil reserves are 38 billion barrels (six billion tons), with a recoverable volume of about 10 billion barrels. Natural gas reserves are estimated at over one trillion cubic meters.
The developers of the project plan to begin commercial production at Kashagan in the first quarter of 2013.
At present, the Kashagan project's participants are Eni, Royal Dutch Shell, Exxon Mobil, Total and KazMunaiGas, which own equal numbers of shares (16.81 per cent), as well as ConocoPhillips - 8.4 per cent and Japan's Inpex - 7.55 per cent.