Kazakhstan wants stake in oil field
LONDON Kazakhstan is determined to take a stake in the country's Kashagan oil field, signaling that there might be further turmoil in the development of the world's largest oil find in more than three decades, according to the country's top energy official.
"Does a country have a right to purchase a stake in a project that is its own?" Vladimir Shkolnik, Kazakhstan's minister of energy and mineral resources, asked during an interview Monday in a London hotel.
"Of course, it has the right to buy such a stake," he answered himself. "The asset belongs to the state anyway."
At issue is nearly one-fifth of the Kashagan oil field, which lies under the Caspian Sea. The area will cost about $29 billion to develop and yield a projected 13 billion barrels of oil. But the project has been beset by delays, and although oil was originally expected to flow in 2005, that date has been pushed back to 2008.
BG Group, ENI, Royal Dutch/Shell Group, Exxon Mobil, Total, ConocoPhillips and Inpex of Japan agreed to develop the field after its discovery in 2000; BG, formerly British Gas, has since opted to sell its 16.67 percent stake.
The oil companies involved say the contract they signed gives them pre-emption, the right and responsibility to offer their stake to another company within the group, with the exception of Inpex, before offering it to an outsider.
"The partners have a right to pre-empt, and we have a right to assign our share within the consortium," said a BG spokeswoman, Petrina Fahey. BG is in talks with the six other companies that have stakes in the project, Fahey said.
The Kazakhstan government disagreed. "If Kazakhstan has direct participation in such a project, the project will move much faster," Shkolnik said.
The government has been discussing a proposal that would allow the country to buy some below-ground rights in projects, and oil industry specialists say the decision to buy into Kashagan may have stemmed from the talks.
The New York Times