Askar Khassenov, Chairman of the Management Board of Kazakhstan's national oil company KazMunayGas, has refuted Bloomberg's report about plans to create a joint venture with ExxonMobil to develop the western part of the Kashagan field, reports infohub.kz.
"This is false information. I read the news, and we, as KazMunayGas, do not confirm what was stated in Bloomberg," he told journalists.
According to him, ExxonMobil has been a long-standing and reliable partner of KazMunayGas, with which the national company has signed agreements on field development and technology advancement. "We are always in partnership with them, but what was stated in the Bloomberg article, we do not confirm," Khassenov emphasized, declining to comment on reports of fines against the Kashagan operator, in exchange for the cancellation of which ExxonMobil allegedly would invest $80 billion in developing the western part of the field.
He confirmed that the current operator of Kashagan, the NCOC consortium, is working on the eastern part of the field. When asked about the possibility of creating a joint venture in the future, Khassenov suggested waiting until the end of the production sharing agreement (PSA) for Kashagan, which expires in 2041. According to him, negotiations on future development terms after the PSA expires have not yet begun.
"Today it is difficult to say – as of today... Today we all, as partners, are engaged in the development of eastern Kashagan," he said.
Earlier, Bloomberg reported that ExxonMobil proposed a new project to Kazakhstan for developing the western part of Kashagan with potential investments of about $80 billion. However, the company linked the project's implementation to the resolution of a long-standing dispute between Kazakhstan and the international oil companies operating at the field.
According to the agency, ExxonMobil and KazMunayGas would create a joint venture on a parity basis (50/50) to develop the western part. The American company estimates that the new project could produce up to 600,000 barrels of oil per day.
The developed eastern part of Kashagan currently produces about 450,000 barrels of oil per day. The operator, North Caspian Operating Company, expects to increase this to approximately 500,000 barrels per day in 2026 and to 710,000 barrels by 2031.
According to Bloomberg, ExxonMobil tied potential future multi-billion investments to the settlement of Kazakhstan's claims against the current consortium members. These are state demands of about $150 billion, mostly related to lost revenues due to delays in field development, and are being considered in international arbitration. According to the agency's sources, KazMunayGas supported ExxonMobil's proposal.
However, the project would require political approval from the Kazakh side, which is not yet guaranteed. ExxonMobil, KazMunayGas, and Kazakhstan's Ministry of Energy declined to comment to Bloomberg on the negotiations.
The Kashagan field is developed by the North Caspian Operating Company (NCOC) consortium. Its shareholders are KMG Kashagan B.V. (16.877%), Shell Kazakhstan Development B.V. (16.807%), Total EP Kazakhstan (16.807%), AgipCaspian Sea B.V. (16.807%), ExxonMobil Kazakhstan Inc. (16.807%), CNPC Kazakhstan B.V. (8.333%), and Inpex NorthCaspian Sea Ltd. (7.563%). The consortium has invested about $60 billion in the project.