Authorized organization PSA LLP representing the government in oil and gas projects announced about nearing commencement of the procedure for return of the mineral resources utilization rights on Kalamkas-more field to the Republic.
As PSA reports NCOC consortium, the shareholders of which are Kazmunaigas (16,88% shares), Shell, ExxonMobil, Total and Italian Eni (16,81% each) as well as Chinese CNPC (8,33%) and Japanese Inpex (7,56%) announced about refusal from plans to develop Kalamkas-more. Whereas Shell also advised Kazakhstan authorities about leaving of Khazar field development project, in which it owns 55% of shares.
“We received official notices from NCOC and Shell about leaving Kalamkas-more and Khazar projects respectively. The decision of our partners is related to low profitability of these projects and high capital expenses”, – they said in the Republic of Kazakhstan Ministry of energy.
Whereas it is stated that “in December 2018 between the Republic and North-Caspian project participants the Agreement was signed regarding Kalamkas-more field, in which the parties agreed that in case of failure to provide the development plan for approval by the end of 2019 the Kalamkas-more field will be voluntarily returned to the Republic”.
Kalamkas-more is included into contractual territory with Kashagan field being developed by NCOC consortium under the Product sharing agreement (PSA) terms.
Khazar structure is included into contractual territory of Zhemchuzhina field, which is developed by Caspi Meruerty Operating Company (CMOC) under PSA terms. Besides Shell (55%) the shareholders of the latter are Kazmunaigas (25%), Oman Oil (20%).
“Soon there shall be launched a procedure of returning the rights to use mineral resources in Kalamkas-more field to the government. Upon completion of this process the Republic may consider the issue of inviting other investors to the project”, – they said in the Republic of Kazakhstan Ministry of energy.
New contracts will be based on the current tax legislation rather than under product sharing agreement terms.
“From economic point of view this is an advantage for the Republic. In case of official notice from all project participants about leaving Khazar field the similar procedure of return to the government will be carried out regarding this site. Whereas expenses on realization of the project incurred by current shareholders are non-refundable. Shell company at the moment invested around 900 millions of US dollars to Khazar project realization in form of geological-exploration and seismic operations, drilling of appraisal wells, and all of this will be transferred to the Republic free of charge”, – they told in the Ministry.