Kazakhstan’s Minister of Energy and Mineral Resources Sauat Mynbaev said foreign participants in the Agip KCO consortium have proposed postponing the beginning of commercial production for another couple of years in Kazakhstan’s Kashagan oil field. According to the minister, they talked about re-scheduling the “big Kashagan oil” from 2011 to 2012 or 2013. “The foreign participants of the consortium want to postpone. They have different scenarios - 2012 or 2013,” Mynbaev said. Such a position of the consortium shareholders puts an end to the plans of Kazakhstan to become one of the world’s 10 largest producers of “black gold,” or rather, it puts them off for another two years resulting in a total setback of seven to eight years, considering the original date of the first oil plan had been 2005.
Meanwhile, experts told New Europe that a further change of dates, from 2011 to 2012-2013, was predictable. “Today’s announcement by the Minister of Energy Mynbaev about the extension is a not a joyful one. It appears that the six months of bloody negotiations between the Kazakh government and the shareholder of Agip KCO have not worked,” an international oil lawyer of one of the foreign companies said, commenting on the latest Kashagan news. Anyhow, he admitted, the oil specialists had previously doubted the beginning of commercial production in 2011. “In fact, 2012 and 2013 were said to be more realistic by the other participants of the talks, in particular, by Shell and Exxon- Mobil, but the project operator – the Italian ENI - maintained otherwise,” the lawyer said.
He said if the question of an extension to 2013 comes up, Kazakhstan may demand a 50 percent interest in the project. As a result of the lengthy negotiations with the consortium on the extension to 2011 in January this year, the Kazakh government has been able to increase its interest in the project from 8.33 percent to 16.81 percent. ENI expects Kashagan’s output to reach 370,000 barrels per day when it eventually comes online and to reach peak production of 1.5 million barrels per day by 2019.