News 2013October, 2013
“ConocoPhillips Company has completed the transaction with KazMunaiGas (KMG) National Company JSC for the sale of 8.4% share in the Kashgan field development project for $ 5.4 billion”, according to the website of the American company. “ConocoPhillips announced today the completion of the transaction with KMG for 8.4% of its share in the production sharing Agreement in the northern part of the Caspian Sea (Kashagan) at the amount of about $ 5.4 billion”, a statement issued on October 31 says.
In July 2013, ConocoPhillips announced that he has received a notice from the Ministry of Oil and Gas (MOG) of Kazakhstan saying that it intends to exercise its right under the law of the Republic of Kazakhstan on subsoil use for the priority purchase of the proposed share of ConocoPhillips in Kashagan for Videsh Limited. KMG was indicated by the Ministry as a buyer.
"This is a very important moment for ConocoPhillips. Since becoming in May 2012 an independent E&P company, we have made significant progress in increasing the efficiency of our shareholders by eliminating non-core assets. We are grateful to KazMunajGaz for his cooperation in the successful completion of this transaction.
Incomes from this transaction will be used for general corporate purposes, including investments in the company's programs on internal growth”, said the Executive Vice President for Sales, Business Development and Corporate Planning, Mr. Don Vallett. As it was reported, the sale of the ConocoPhillips asset in the Kashagan project is a part of the company's plan to increase the value of the joint stock company through the portfolio optimization based on investments that provide production growth, cash margin and profit.
We remind you that ConocoPhillips officially informed the Government of the Republic of Kazakhstan and the project partners about its intention to sell its share to the Indian ONGC Videsh Limited at the end of November 2012. The amount of this transaction was estimated at $ 5 billion. The Ministry of Oil and Gas of the Republic of Kazakhstan appointed KazMunaiGas as a buyer of ConocoPhillips share in Kashagan.
The transaction was planned to be completed in the IV quarter of 2013. Kashagan field was discovered in 2000 and became the largest one in terms of deposits among the fields discovered during the last 30 years. Its commercial resources, according to the experts, are within 9-13 billion barrels of oil.
Prior to the completion of the transaction, the shares of the Kashagan project participants were allocated as follows: Eni, Royal Dutch Shell, Exxon Mobil, Total and KazMunayGas (by 16.81% each), ConocoPhillips - 8.4%, and Japan Inpex - 7.55%. The project is managed by North Caspian Operating Company B.V., the joint operating company.