Hungarian oil and gas company MOL to join KazEnergy Association

Oil&Gas Materials 4 June 2013 14:16 (UTC +04:00)
Hungarian oil and gas company MOL to join KazEnergy Association
Hungarian oil and gas company MOL to join KazEnergy Association

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

The largest Hungarian oil and gas operator MOL has decided to join the KazEnergy Association, the press service of the association informed Trend.

'It is connected not only with the current, but also with the prospective activity of the Hungarian firm on the Kazakh fields', the association press service report said.

This issue was considered during the second meeting of the Kazakh-Hungarian Business Council, headed by deputy chairman of the KazEnergy Association Jambulat Sarsenov and the executive vice president of the Hungarian oil and gas company MOL Shandor Fashimon.

The first meeting of the council took place in January 2013 within the framework of Kazakh delegation's business visit to Budapest where the sides discussed more wide ranging issues and specific ones in the sphere of bilateral economic cooperation.

MOL Hungarian Oil and Gas Plc. has a 49 per cent stakes in the KS EP Investments BV Company which in turn owns Karpovsky Severniy LLP. As was reported earlier in November 2012, KazMunaiGas Exploration Production JSC (KMG EP, subsidiary of the national oil and gas company of Kazakhstan KazMunaiGas) had completed the deal on selling the largest Hungarian oil and gas company MOL Hungarian Oil and Gas Plc.

Karpovsky Severniy LLP has the right for subsurface resources management on the basis of agreement on the exploration of oil, gas and condensate on the site of Karpovsky Severniy in the Western area of Kazakhstan.

Estimated prospective recoverable hydrocarbon reserves of the Karpovsky Severniy block are the equivalent of 240 million barrels of oil. It was previously noted that as a result of the agreement, a joint venture between KMG EP and MOL will be created for further exploration works on the Karpovskiy Severni block. The deal was approved during the meeting of the board of directors of KMG EP on June 26, 2010.

The Karpovsky Severniy block is located 40 kilometres north-west of the City of Uralsk, in the immediate vicinity of the Fedorov block and other fields in the external board of the Caspian basin. The total area of the contractual territory is 1670 square kilometres. The result of previously carried geological exploration works, as well as seismic and borehole data prove the existence of hydrocarbons in this area.

Residual licence obligations include the drilling of two deep pre-salt exploration wells and carrying out of small volume seismic surveys.

The deal will provide KMG EP with the possibility to split geological risks and financial obligations with MOL under this licence. The achievement of operation synergy is also possible with the neighbouring Fedorov block where the stakes are owned by KMG EP by 50 per cent and MOL which owns 27.5 per cent. A significant gas and condensate field was opened in 2008 on the Fedorov Block. MOL is the operator of consortium.

KMG EP is among the three leaders in terms of the value of oil production in Kazakhstan. The company's production value including the shares in companies such as LLP JV Kazgermunai, CCEL (JSC Karazhanbasmunai) and PetroKazakhstan Ink, in 2011 was 12.3 million tons (250,000 barrels per day). The value of the proved and probable reserves of KMG EP as at the end of 2011 was 226 million tons (1.7 milliard barrels) and included shares in joint ventures of nearly 2.1 milliard barrels.

KazEnergy Association was created on November 2, 2005 and unites more than 50 large participants of the oil-gas and energy complex, as well as production, transportation, service and geophysical, uranium and other transnational companies.