Eni has signed an agreement with Kazakhstan for the Karachaganak Petroleum Operating (Kpo) consortium, thus closing the disputes and bringing the Kazakh state company Kmg into the consortium.
Consortium companies Karachaganak Petroleum Operating (KPO), BG and Eni co-operators with 32,5%, Chevron and Lukoil partners with 20% and 15% respectively, signed a binding agreement in Astana with the Republic of Kazakhstan for the closure of all ongoing disputes and the entry into the consortium of the Kazakh state company KazMunaiGaz (Kmg).
The agreement, underlined ENI, is "an important step forward for strengthening cooperation between the parties in support of future developments in the field, from which a substantial increase in the production of liquids and gas is expected". The agreement will become effective by June 30, 2012.
Kmg's entry into the consortium "will be achieved through the pro-quota transfer by the consortium companies of 10% of the projectfor a net consideration of $1 billion." This payment will take place through a loan that the consortium will grant to Kazakhstan and which will be guaranteed and repaid by the revenues relating to the 10% acquired by the Kazakh counterpart in the project.
Kazakhstan will also make available a transport capacity in the CPC pipeline which will be able to reach 2 million tons per year of liquids produced in Karachaganak, until the concession expires in 2037.
Karachaganak – adds Eni – is a giant field producing oil, condensates and natural gas with recoverable reserves estimated at 5 billion boe (barrels of oil equivalent). Production in Karachaganak during the year was 228 thousand barrels per day of liquids (65 thousand net to Eni) and 23 million cubic meters per day of natural gas (about 7 million net to Eni).
