KazMunaiGas to develop offshore field with ConocoPhilips, Mubadala

energy

KazMunaiGas to develop offshore field with ConocoPhilips, Mubadala

By SRI ⋅ October 6, 2008 ⋅

(SRI) - KazMunaiGas, the Kazakh national oil company, signed a memorandum of understanding with ConocoPhillips and Mubadala Development Company to explore and develop the N Block, an offshore field in the Caspian Sea, the company said on Sunday.

American ConocoPhillips and Abu-Dhabi government-owned investment agency Mubadala will each hold a 24.5 percent stake in the offshore Kazakh block in the Caspian Sea.

“The parties will now have until December 31, 2008, to negotiate the definitive agreements for the assignment by KMG of a 49 percent interest in the subsoil use contract to be shared equally between ConocoPhillips and Mubadala,” KazMunaiGas said in a statement. “KMG will remain the majority partner in the venture.”

The N Block is located 30 kilometers south southwest offshore the Caspian town of Aktau. The block covers approximately 8,100 square kilometers and is considered to have high prospects for both oil and gas, KMG said. KMG had earlier estimated the block to hold about 637 million metric tons - or 4.7 billion barrels - of oil equivalent, making it potentially the largest undeveloped project in the Kazakh portion of the Caspian shelf.

The memorandum of understanding was signed by Kairgeldy Kabyldin, chief executive of KMG; Jim Mulva, chief executive of ConocoPhillips, and Khaldoon Khalifa Al Mubarak, chief executive officer of Mubadala.

The N Block had been the target of attention of both Royal Dutch Shell PLC ( RDSA) and ConocoPhillips before the Kazakh government granted exclusive exploration and production rights to KMG last year.