Kazakh parliament approves energy bill

Nov 05, 2004 01:00 AM

Kazakhstan's parliament approved a bill giving the government priority in buying stakes in energy projects put up for sale in the oil-rich nation. Foreign investors currently dominate the Central Asian country's oil and gas sector.
Parliament's upper house, the Senate, unanimously backed the bill that would pave the way for national company KazMunaiGaz to win its stalled bid to join an international project to develop a giant oil field in the country's Kashagan oil field, one of the world's biggest.

The bill was approved by the lower house last month. In order to take effect it must be signed by President Nursultan Nazarbayev, who is highly likely to approve it.
The Kazakh government argues that it has ownership rights to Kashagan. Its bid to get a share in the field is seen as part of its effort to increase KazMunaiGaz's participation in the country's oil and gas sector.

The government of this former Soviet Republic is in talks with a seven-member international consortium to buy a 16.67 % stake in Kashagan from group member British Gas -- a share worth about $ 1.2 bn (EUR 977 mm).
The consortium now has the right to buy the stake and could block KazMunaiGaz's bid, but the new could give the government strong leverage to win any such negotiations.

British Gas has said it intends to sell its stake to other consortium members like Italian energy giant ENI, British Gas, Total, Shell, ExxonMobil, ConocoPhillips and Japan's Inpex.
The Kashagan field, which lies beneath the northern part of the Caspian sea and was discovered in 2000, has an estimated 4.8 bn tons of oil. Production there is expected to start in 2007-08.

Source: AP
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