Karachaganak: Royal Dutch Shell’s forthcoming acquisition of the BG Group exploration company may trigger the forced sale of BG’s 29.25% stake in Kazakhstan’s highly lucrative Karachaganak field.
Located in the north-west of the country and and covering over 280km², Karachaganak is one of the world’s largest gas and condensate fields with estimated hydrocarbons in place of 9bn barrels of condensate and 48tr ft³ of gas, and estimated gross reserves of over 2.4 bn barrels of condensate and 16tr ft³of gas.
Acknowledged as a ‘cash cow’, the field is currently producing at record levels, and accounts for around 45% of Kazakhstan’s total gas production and approximately 16% of its total liquids production. The field is operated by the Karachaganak Petroleum Operating (KPO) JV set up by the BG Group (29.25%), Eni (29.25%), Chevron (18%), LUKOIL (13.5%) and KazMunaiGas (10%).
According to a report in the Wall Street Journal at the weekend, there is a paragraph in BG’s 2014 annual report stipulating that the Kazakh government has the right to acquire the firm’s stake in Karachaganak if BG is sold.
BG acquisition may force Shell to sell stake in Karachaganak
Source: seekingalpha