Kazakhstan revises approach to PSAs at Tengiz, Karachaganak, and Kashagan
Kazakhstan has initiated negotiations with foreign investors to conclude new Production Sharing Agreements (PSAs) for the Tengiz, Karachaganak, and Kashagan oil fields. This was announced by Prime Minister Olzhas Bektenov during a press conference, reports a Kazinform News Agency correspondent.
“As for the conditions under which major oil projects are being developed - they are governed by production sharing agreements. There is an opinion that the country’s interests have been significantly compromised. We are now beginning negotiations with our consortium partners to conclude new PSAs for a new period,” the Prime Minister said.
He emphasized that Kazakhstan intends to uphold its national interests while acting within the framework of its international obligations.
“Of course, we are not talking about a harsh revision of any contracts, because this is a very sensitive issue that affects the investment climate. That’s why we will approach this process carefully,” the head of government added.
In early July, the Ministry of Energy of Kazakhstan announced the termination of a gas processing plant construction project at the Karachaganak field within the current PSA framework involving the project shareholders. Previously, the Ministry had stated it was prepared for a possible deterioration in the gas processing situation and a risk of commercial gas shortages in the domestic market should the plant’s construction be delayed.
It is also worth noting that on May 28, Prime Minister Olzhas Bektenov met with ExxonMobil Senior Vice President Peter Larden. During the meeting, they discussed the current status and progress of key joint projects, including the Tengiz and Kashagan fields, as well as the continued operation of the Caspian Pipeline Consortium system. Special attention was given to the launch of the Future Growth Project at Tengiz, which is expected to strengthen Kazakhstan’s position in the global energy market.
Earlier, it was reported that Karachaganak shareholders demanded an additional $1 billion from Kazakhstan for the gas processing plant project, despite the country already covering the full construction costs, according to the Ministry of Energy.
