OCT. 5, 2012 — The sale of ConocoPhillips’ 8.4% stake in the Kashagan oil field will allow Kazakhstan to buy more of the project
STORY — For years Kazakhstan has complained that deals struck with Western energy companies in the 1990s were unfair. Its line was that Western energy companies took advantage of its post-independence vulnerability to force through one-sided agreements.
That has changed over the past few years as Kazakhstan has re-negotiated agreements to give itself a greater slice of projects. The state oil and gas company KazMunaiGas owns a 16.8% stake in Kashagan but senior Kazakh officials have made clear that they want a larger chunk of the high profile project.
Now, with the announcement that ConocoPhillips wants to sell its 8.4% stake, Kazakhstan should be able to fulfil this ambition.
ConocoPhillips has not yet confirmed the sale but the statement by the Kazakh minister for oil gas, Sauat Mynbayev, was categorical.
Speculation has swirled around ConocoPhillip’s stake for some time and when asked if the US company would sell, Mr Mynbayev replied: “They have informed that they have the intention of selling.”
The other shareholders in Kashagan are Exxon Mobil, Royal Dutch Shell, Eni and Total, each with a 16.8% stake. Japan’s Inpax owns a 7.56%.
Kashagan, though is over-budget and late. At the same time that stakes in Kashagan are being debated, the consortium is still trying to produce its first oil.
The latest production start date, released by Mr Mynbayev as he was also declaring that ConocoPhillips would sell its stake, has again been pushed back. First oil from Kashagan is now not expected until March 2013.
ENDS
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This story was first published in issue 29 of the weekly Kazakhstan News Extra. To subscribe and for more information click here