A Kazakhstan official is claiming China may acquire a US major’s share in the Kashagan field.
Sauat Mynbayev, Kazakhstan’s Oil & Gas Minister, says the government is considering exercising its pre-emptive right to buy out ConocoPhillps’ 8.4% share in the field in order to sell it to China. ConocoPhillips had originally planned to sell its stake to India’s Natural Gas Corp for around $5 billion. The developing nation has until May to decide whether or not to buy the stake back for resale.
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At stake: the Kashagan field Image: ConocoPhillips |
Mynbayev did not disclose the name of the government body, or the Chinese company interested in the field. He also declined to speculate on which nation was likely to win the lucrative share.
However, “If the terms offered by one side are significantly better than those of the other potential buyer”, said Mynbayev, “then the logic (of choice) of the authorities of Kazakhstan would be crystal-clear.”
Dominic Lewenz, and analyst at Visor Capital, believes China’s ability to offer loans as part of the deal may give it more leverage should it choose to make a bid.
Kazakhstan is home to around three percent of the world’s recoverable oil reserves. Kashagan, the world’s largest discovery in more than 40 years, holds between 8-12bn barrels of recoverable oil and is expected to start production in the middle of this year.