Establishment of a New Company on Basis of Nations Energy Not to Impact KAOC`s and KVOC`s Operating Activity in Azerbaijan

Oil&Gas Materials 27 October 2006 16:39 (UTC +04:00)

China's CITIC Group is about to acquire the Kazakhstan assets of the company Nations Energy for $1.91 m., Trend reports referring to a press-release spread by Nations Energy.

The document points out that after the forthcoming deal, Nations Energy will transform all its non-Kazakhstan assets to a new company which name has not been disclosed yet.

The owners of the new company will be the existing shareholders of Nations Energy, the document points out. Particularly, 76% in Nations Energy belong to Ecolo Investments Ltd.

Nations Energy owns 94.6% of the sharing in Kazakhstan`s Kasrajanbasmunay JSC that is developing the field Karajanbas. The contract signed was considered for 2020. The field has proved reserves at more than 340 m. barrels of oil with the current oil production exceeding 50.000 barrels a day.

In Kazakhstan, Nations Energy also owns Argymak Trans Service LLP engaged in transport and cargo services and Tulpar Munai Services LLP engaged in preparing and organizing drilling works and


The deal between CITIC Group and Nations Energy might be concluded in December, 2006. However, it is not ruled out that other interested parties may outbid the Chinese offer up to that moment.

In Azerbaijan, Nations Energy is an operator of the two projects development of the onshore field Mishovdagh-Kalamatdin(KAOC the operating company of this project) and Padar-Kharrami (KVOC).

According to the experts of the oil industry of Azerbaijan, the possible buying Nations Energy`s Kazakhstan assets by CITIC Group and establishment of a new company on the basis of the non-Kazakhstan assets of Nations Energy will have no influence on its operating activity in Azerbaijan.

The company will keep its experience, activity, specialists and continue oil and gas operations in the country in a customary regime, point out these experts.