Kazakhstan has the right to be the first in buying out of ConocoPhilips share in Kashagan project
If ConocoPhilips sells its share in the North Caspian project ofthe Kashagan deposit then Kazakhstan has the right to be the first in the buying out of the share, Razvedka Dobycha Kazmunai Gas (RD KMG) CEO A. Balzhanov reports. ‘In the case of the probable sale of the share there’s the shareholders agreement under which the priority right for purchase belongs to the shareholders of the project. ConocoPhilips did not express any wish to sell the share in N project (the block of Nursultan in the Kazakh sector of the Caspian Sea), the point of discussion is the North Caspian project only’, he says.
ConocoPhilips shares 8.4% in the North Caspian project. Recently the mass-media reported that probably ConocoPhilips would leave the project. The news appeared on the background of negotiations between the project shareholders and the Government of the republic about the second stage of the Kashagan deposit's development.
Mr. Balzhanov says that if the price about which the selling company has agreed with anybody satisfies the state then Kazakhstan can buy the shareholding but at this particular price. If the state is dissatisfied then its shareholders’ turn. If none of shareholders is eager to execute the transaction after the state for the buying out of the shareholding then it can be put for sale to other participants of the world oil business.
Kashagan is located in Northern area of the Caspian Sea. Its geological reserves are 4.8 billion tons of oil. In H2 2010 KMG chief, K. Kabyldin reported that the second stage of the deposit's development would be postponed until 2018-2019 and that would influence in turn the start of the realization of the project for the Caspian pipeline transport system. Earlier the Minister of Oil and Gas, S. Mynbayev said that the postponement was connected with large expenses that the consortium participants could bear. Mr. Mynbayev claimed that the discussion about postponing of the second stage dates would not have negative impact into the start of commercial oil production at Kashagan.
The partners in the Kashagan projects are Eni, KMG Kashagan B.V., Total, ExxonMobil, Royal Dutch Shell sharing 16.8% each, ConocoPhillips with 8.4%, Inpex with 7.56%.
Translated by Nadezhda Poltoratskaya
