Kazakhstan's Prime Minister Karim Masimov speaks at the Kazenergy conference in Astana September 6, 2007.
Photo: Reuters
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Kazakhstan Resumes Talks on Kashagan Field
Negotiations of Kazakhstan’s authorities with foreign investors and envoys of EU to sort out the Kashagan conflict will continue this week. Kazakhstan cannot yield at the talks – implementation of investors’ requirements may aggravate economic conditions in the country.
The Second Eurasian Energy Forum, KazEnergy, ended in Kazakhstan Friday. But already during its opening, Kazakhstan’s Prime Minister Karim Masimov managed to further cloud relations with foreign investors led by Italian Eni.
On Saturday, however, Masimov reported that Eni CEO Paolo Scaroni would arrive in Astana next week to proceed with negotiations. European Energy Commissioner Andris Piebalgs confirmed he would join the discussion. Moreover, according to Interfax-Kazakhstan, Italy's Prime Minister Romano Prodi was to visit Astana past weekend to talk to Kazakhstan’s President Nursultan Nazarbaev and PM Karim Masimov.
The Kashagan field with recoverable reserves of above 1 billion tons of crude oil is located in Kazakh sector of the Caspian Sea. The field is developed under the PSA by Agip KCO, where Eni, Total, ExxonMobil and Shell hold 18.52 percent each, ConocoPhillips owns 9.26 percent and KazMunaiGas and Inpex have 8.33 percent each.
The conflict around Kashagan sparkled once the operator put off again the dates of its production launch to 2010, announcing, at the same time, the double increase in project costs. But the delay would break all plans of Kazakh authorities for crude oil output of the country.
When speaking at the forum, Masimov vowed to attain the annual production of 140 million tons of oil by 2015 (vs. 67 million today). The project of Kashagan development sets forth three stages; the first one (four years) provides for the output of 22.4 million tons, the second stage (three years) sets forth production of 44.8 million tons, while the third stage (five years) provides for attaining the record production of 59.7 million tons exactly by 2015.
So, shelving the Kashagan production would strip Kazakhstan of 15 million tons at best vs. the initial plans by 2015. In addition to other benefits, Kashagan is vital for Kazakhstan in view of macroeconomy. According to some estimates, its launch will triple the exports of crude oil from that country of Asia.
www.kommersant.com
All the Article in Russian as of Sep. 10, 2007
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