The Cost of LUKOIL’s Purchase of 50% in Kalamkas-Khazar Operating LLP Amounted to $200 Million
PJSC LUKOIL, which last year acquired 50% of Kalamkas-Khazar Operating LLP (KCO), paid $200 million for this share, according to the annual report of KazMunayGas (KMG).
“On February 9, 2023, the company and PJSC LUKOIL signed a purchase and sale agreement for a 50% share in the authorized capital of KKO, a subsidiary of KazMunaiGas – IF), which is the holder of the contract for hydrocarbon production in the Kalamkas-Sea, Khazar and Auezov, located in the Kazakh sector of the Caspian Sea. (…) The cost of selling a 50% participation interest amounted to $200 million (equivalent to 93.258 million tenge on the date of disposal of the subsidiary),” says KMG’s materials.
According to KMG, the payment was made on September 21, 2023.
In September, KMG and LUKOIL completed the procedures under this transaction. “KMG and LUKOIL completed a transaction, as a result of which LUKOIL became a member of Kalamkas-Khazar Operating LLP with a 50% participation share,” the company’s response to a request from the Interfax-Kazakhstan agency was then stated.
Now KMG and LUKOIL own equal shares in Kalamkas-Khazar Operating, which is the operator of the Kalamkas-Sea, Khazar, Auezov project on the Caspian Sea shelf.
On February 9, 2023, in Astana, KMG and LUKOIL entered into a number of agreements on the project for the development of the Kalamkas-Sea, Khazar, Auezov subsoil area. The parties signed an agreement of participants, a purchase and sale agreement for 50% in the authorized capital of Kalamkas-Khazar Operating LLP and an agreement on the terms of financing by participants of the operator’s activities.
It was also reported that Kalamkas-Khazar Operating planned to submit a field development project to the Central Commission for Exploration and Development of Hydrocarbon Fields (CCRR) of Kazakhstan in the third quarter of 2023.
The Kalamkas-Sea, Khazar and Auezov fields are located in the Kazakh sector of the Caspian Sea. The distance to the shore is 60 km, the water depth is 7-9 meters. Production is expected to begin in 2028 and will be 3-4 million tons per year. The total cost of field development will be about $5 billion.
The Kalamkas-Sea field was discovered in 2002; it is located 120 km southwest of Kashagan and very close to the Khazar field. The total recoverable reserves of the Kalamkas Sea and Khazar are estimated at 67 million tons of oil and 9 billion cubic meters of gas.
