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Major events in Caspian countries' oil and gas industry for week

Analysis Materials 8 October 2012 14:03 (UTC +04:00)
SOCAR has presented an official proposal on participation in TANAP to BP, Statoil and Total companies, a high ranking SOCAR representative reported. "We have already sent letters to BP, Statoil and Total with 29 per cent of shares, this is our official proposal," SOCAR representative noted. According to SOCAR representative, each party has already informed SOCAR on reception of the proposal and on respective work conducted in this direction. 20 per cent share of TANAP currently belongs to Turkish BOTAS, SOCAR has 80 per cent share. Previously SOCAR noted that it welcomes 3 more companies in this project - BP, Statoil and Total.
Major events in Caspian countries' oil and gas industry for week

SOCAR officially invited partners to participation in TANAP project

SOCAR has presented an official proposal on participation in TANAP to BP, Statoil and Total companies, a high ranking SOCAR representative reported.
"We have already sent letters to BP, Statoil and Total with 29 per cent of shares, this is our official proposal," SOCAR representative noted.
According to SOCAR representative, each party has already informed SOCAR on reception of the proposal and on respective work conducted in this direction.
20 per cent share of TANAP currently belongs to Turkish BOTAS, SOCAR has 80 per cent share. Previously SOCAR noted that it welcomes 3 more companies in this project - BP, Statoil and Total.

SOCAR, BP sign new agreement

Geophysics and Geology Department of the State Oil Company of Azerbaijan (SOCAR) and BP signed a framework agreement on technical services, SOCAR reported.
As SOCAR First Vice-President on Geology, Geophysics and Mining Khoshbakht Yusifzade said at the signing ceremony, by signing the new agreement SOCAR's opportunities in providing technical services in exploration and evaluation projects, in which BP is the operator, increases.

SOCAR to present new gas contract to foreign partners

The State Oil Company of Azerbaijan (SOCAR) will present a preliminary version of a new contract on the project to develop deep bedding gas on the block in the Azerbaijani sector of the Caspian Sea to the partners of Azeri-Chirag-Guneshli (ACG), a SOCAR senior representative told. He said work on the draft version of the contract is almost complete.
"We are already completing the preparation of the draft. Preparing the draft does not mean that it will be signed, because it should still be agreed. After completion we will present it to BP and other partners, following which the negotiation process will begin. I think we will come to an agreement," he said.
At present, oil reserves of ACG are developed based on the PSA contract. However, according to the SOCAR representative, the contract to be signed by all of the participants of the project will be signed in a new format.
"This will be an agreement of a new format, a Risk Service Agreement (contract with a minimum guarantee of compensation). Approval will be in the same form and we will approve it at parliament," he said.

ConocoPhillips to sell its share in Kashagan

The ConocoPhillips Company, one of the shareholders of a project on the development of the world's major oil field Kashagan (Kazakhstan), plans to sell its stake according to the Oil and Gas Minister of Kazakhstan Sauat Mynbayev.
There are partners who are ready to buy this package," Mynbayev said, without specifying which partner is exactly ready to buy the share of ConocoPhillips.
As it was reported earlier, Kazakhstan jointly with Eni, Exxon Mobil, ConocoPhillips, Royal Dutch Shell, Total and Inpex Holdings Inc has been seeking to start commercial production at Kashagan since 2005. After several years of delays the latest "deadline" - late 2012 - mid 2013 - has been set.

Fuel rises in price in Georgia

Fuel has risen in price by five tetri ($ 1 = 1.65 lari) on Georgian market, and costs from 2.1 lari to 2.35 lari, depending on fuel quality.
Chairman of the oil products importers' Union Vano Mtvralashvili traditionally accounts petrol price hike for rising prices for oil products on world markets.
He said that on July 1 the world gasoline platts price was $910 per tonne, but then it increased by another $ 140. Higher prices on the world market were expected, because fuel consumption increases in the summer, the union chairman said.
Changes in world prices is reflected in the Georgian market during 15-20 days, although the Georgian companies kept prices and made an adjustment only 40 days after, Mtvralashvili said.

Iran, Turkey discuss oil pipeline construction

Iranian delegation which is on the visit to Turkey, has discussed a possibility of constructing an oil pipeline to Europe through Turkey's territory, IRNA reported. Iran's Oil Minister Rostam Qasemi told journalists in Turkey that the countries are discussing options for transferring Iranian gas to Europe, through Turkey.

Kazakh Oil and Gas Ministry expects implementation of Tengiz further growth project

The Kazakh Oil and Gas Ministry expects a rapid submission of a project on the expansion of Tengiz to the Central Exploration Commission.
"We expect the implementation of the so-called project of the expansion of Tengiz," Kazakh Oil and Gas Minister Sauat Mynbayev said at the KazEnergy forum today. He added that at present, the project is under the consideration of shareholders.

Kazakh Oil and Gas Ministry confirms date of launching production at Kashagan

The Kazakh Oil and Gas Ministry confirmed the date of expected commencement of commercial production on the "Kashagan" field in the period from January to June 2013.
"We expect the commercial production will start at Kashagan in the period from January to June 2013," Kazakh Oil and Gas Minister Sauat Mynbayev said at KazEnergy forum.
"The Kazakh Oil and Gas Ministry expects the relevant documents on the second phase of the Kashagan project from the consortium. The preparatory work is underway."

Kazakh JSC "EmbaMunaiGas" acquires right to develop oil fields under six contracts

JSC KazMunaiGas Exploration Production ("KMG EP" or the "Company") Board of Directors approved the transfer of subsoil use rights to JSC "EmbaMunaiGas" effective from 1 October, 2012 under the following six contracts, the company's press release says.
"The question is about the following contracts: No.37 Kenbay field; No. 61 SE Novobogatinskoye field; No. 211 Botakhan, Makat, Dossor, Tanatar, Kamyshitovoye, etc. 23 fields in total; No. 413 Prorva, Kulsary, Karaton, Koschagyl, etc. 15 fields in total; No. 327 Taisoigan field; No. 992 Novobogatinskoye West field," the press release says.
The Board of Directors also approved the distribution of dividends of LLP "JV Kazgermunai" for the first half of 2012 of US$300 million. The share of KMG EP will be US$150 million.

Kazakhstan revises transit tariff for Russian oil to China

General Director of the Kazakh company "KazTransOil" Kairgeldy Kabyldin confirmed the reduction of tariffs for transportation of Russian oil to China.
"We revised the tariff for attractiveness of the route. The new tariff creates additional opportunities for transit," Kabyldin told reporters on Wednesday.
At the same time, he said, the Russian side has not made any decision yet.
"We are interested in transit of Russian oil to China [...] but Russia will deal with logistics. Russia has two options to transport its oil to China: through the Far East, and through Kazakhstan. But no one has yet guaranteed that the volumes will be shipped via us, although the intergovernmental agreement envisages transit of Russian oil via Kazakhstan," Kabyldin said.

Oil and gas extraction plans for Kashagan in 2013 announced in Kazakhstan

Kazakhstan has set plans to extract 13 million tons of oil and 9 billion cubic meters of gas on the Kashagan field in 2013, Deputy Oil and Gas Minister Berik Tolumbayev told media today.

"Oil production on Kashagan is expected to reach 13 million tons of oil and 9 billion cubic meters of gas from 2013," he said.

He said that the pilot-industrial phase of the "Kashagan" project will begin in the first quarter of 2013. The issue of extending the contract with the shareholders of the The North Caspian Operating Company BV (NCOC) consortium, developing the field, has not been discussed yet.

"The 20-year contract extension has not been raised," he said. "It is connected with the development strategy. We are now discussing a strategy of developing Kashagan first stage."

The contract between the Republic of Kazakhstan and NCOC consortium expires in 2040.

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