BP Amoco announced on February 2nd that it had agreed to sell its stake in Kazakstan’s offshore Kashagan oil field to French-Belgian oil giant TotalFinaElf.
BP holds a 9.5 percent share in the Offshore Kazakstan International Operating Co. (OKIOC), which is exploring the giant Kashagan field.
A TotalFinaElf spokeswoman said that: “We can confirm that we are in negotiations with BP to buy their stake. This is in line with our policy to strengthen our position in the project.”
BP declined to name a specific figure for the deal, but analysts suggested that the company’s stake could be worth at least $400 million.
TotalFinaElf had earlier announced its desire to become the operator of Kashagan, one of the world’s largest oil discoveries in decades, although several other OKIOC members had also been vying for the title.
Kazak President Nursultan Nazarbayev had called on the OKIOC in January to select one of its members as operator for the project and threatened to review the Kashagan contract, after meeting with top officials from TotalFinaElf, Agip and Exxon Mobil Corp. in recent months to discuss the operatorship.
A BP spokesman indicated that the company was selling its share because its interest is not large enough to influence the project.
He said that: “Our interest does not give us any real influence or decision-making ability. So it’s difficult for us to have a significant influence on the project, and nobody wanted to sell, so we did not have another option.”
After the sale, TotalFinaElf will be the largest shareholder, with a 23.8 percent interest.
BG, Royal Dutch/Shell, Exxon Mobil and Agip each hold 14.3 percent stakes in the project, while Phillips Petroleum Co. and Japan’s Inpex both own 7.14 percent and Statoil has 4.8 percent. The other OKIOC partners have preemptive rights and could potentially outbid TotalFinaElf for the stake.
© 2001 Mena Report (www.menareport.com)
