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KAZAKHSTAN INTENDS TO BUY BRITISH STAKE
IN CASPIAN OIL PROJECT - PREMIER
The following is an excerpt from the report by Vadim Vasilchenko,
entitled: "Prospects without exaggeration", published
in the Kazakh newspaper Kazakhstanskaya Pravda on 3 August
Following the government's expanded meeting [held on 2 August],
Prime Minister Daniyal Akhmetov answered journalists' questions.
The first question was about a possible purchase of [British]
BG company's stake in the Kashagan oil project [in the Caspian
Sea]. Let us remind you that the company has said it intends
to sell its stake in Kashagan. The Kazakh government has expressed
its desire to buy the entire stake.
"British Gas owns the 16.67-per-cent stake in the Agip
KCO consortium [led by Italy's ENI] and the sale of this stake
is the will of shareholders," Akhmetov said. "Kazakhstan
has made a proposal to BG. At the same time, we proceed from
the principle of non-interference in its [consortium's] activities
and strict observation of the Production Sharing Agreement
and the country's legislation. The deal will increase Kazakhstan's
involvement in the project and as a result the country will
be able to run one of the world's major oil projects".
Journalists also showed their interest in whether possible
amendments to legislation relating to oil extraction might
have their impact on signing a Production Sharing Agreement
with Russian partners on the Kurmangazy field [located along
the agreed median line between Russia and Kazakhstan in the
Caspian Sea].
"Amendments to tax legislation will not become an obstacle
to sign a Production Sharing Agreement," the prime minister
said. "Increasing the country's share in profits to 60
per cent is a normal world practice. Kazakhstan has been receiving
only 25 per cent of the profit until now."
The head of government expressed his confidence that the
sides would sign the agreement by the end of this year.
Asked when the decision would be passed on building a plant
to process gas from the Karachaganak field [in West Kazakhstan
Region], Akhmetov said: "We are seriously considering
building such a plant which will be processing about 10bn
cu.m. of gas [a year]. Our country sticks to a formula that
gas should be processed in Kazakhstan, however we also have
to take Russian interests into account. A total of 7bn cu.m.
of gas [a year] may be supplied to the Orenburg gas-processing
plant [in Russia].
"Other scenarios are also being considered. For example,
a project to expand the Orenburg plant with the involvement
of Kazakhstan. >From the economic point of view, this will
be possible only if Kazakhstan's role in the project and its
exports to foreign markets are clearly defined. I think that
we shall achieve a consensus during Russian Prime Minister
Mikhail Fradkov's visit to our country, scheduled for the
end of this year."
[Passage omitted: newspaper says Kazakhstan and Russia are
to build the Bayterek launching pad at the Baykonur space
launching site in southern Kyzylorda Region - covered]
Source: Kazakhstanskaya Pravda, Almaty, in Russian 3 Aug
04 p2
BBC Mon CAU 030804 nb
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