Al-Jazeerah: Cross-Cultural Understanding
News, September 2013
China Buys Into Giant Kazakh Oilfield for $5 Billion
China, Kazakhstan agree to promote trade, energy cooperation
ASTANA, Sept. 7, 2013 (Xinhua) --
China and Kazakhstan pledged Saturday to promote bilateral trade and energy cooperation and push forward their natural gas pipeline project.
The two countries made the pledge in a joint declaration issued after talks between visiting Chinese President Xi Jinping and his Kazakh counterpart, Nursultan Nazarbayev.
In the document, the two sides vowed to keep on tapping potential in economic and trade cooperation, optimizing bilateral trade structure, promoting trade facilitation, building more platforms and working toward the goal of increasing bilateral trade volume to 40 billion U.S. dollars in 2015.
The two countries also agreed to promote two-way investment and continue to improve their respective legal basis for bilateral cooperation.
Meanwhile, the two countries vowed to extend and deepen their cooperation in energy, as well as ensuring the safe and stable operation of joint projects such as oil and gas exploration and transportation.
According to the declaration, both sides will speed up the expansion of the first phase of China-Kazakhstan natural gas pipeline and the construction of the second phase.
In addition, the two sides agreed to push forward bilateral cooperation in the peaceful use of nuclear energy and the development of alternative energy sources.
The declaration also called for a deeper cooperation in various fields including finance, agriculture, infrastructure construction of border crossings, combating transnational crimes, intellectual property protection as well as education and training.
Xi arrived in Astana on Friday for a state visit to Kazakhstan after attending a Group of 20 (G20) summit in the Russian city of St. Petersburg.
Following his Kazakhstan trip, Xi is scheduled to pay state visits to Uzbekistan and Kyrgyzstan. Before the G20 summit, he visited Turkmenistan.
He will also attend the 13th meeting of the Council of Heads of Member States of the Shanghai Cooperation Organization in Kyrgyzstan.
China Buys Into Giant Kazakh Oilfield for $5 Billion
By Mariya Gordeyeva
Sat Sep 7, 2013 9:17am EDT
ASTANA (Reuters) -
Chinese President Xi Jinping struck a deal with Kazakhstan on Saturday giving China a stake in its giant Kashagan oil project, a highlight of his tour of Central Asia to secure hydrocarbons for the world's largest energy consumer.
The $5 billion deal further increases China's rising clout in post-Soviet Central Asia, once Russia's imperial backyard, and blocks an attempt by global rival India to get a stake in the oilfield, the world's largest oil discovery in five decades.
"The two countries have agreed on China's shareholding in the development of the Kashagan deposit," Xi told a news briefing after talks with Kazakh President Nursultan Nazarbayev. "The two governments hail and support this agreement."
Oil and gas deals, including on building an oil refinery in Kazakhstan, are among 22 agreements worth some $30 billion reached during Xi's visit, Nazarbayev said.
Under the Kashagan deal, Kazakhstan will sell 8.33 percent of the offshore oilfield in the Caspian Sea to China for about $5 billion.
The sale and purchase agreement was signed by the heads of Kazakh state oil and gas company KazMunaiGas and China National Petroleum Corp CNPET.UL (CNPC) in the presence of the two presidents.
"We suppose that the transaction will be closed by late September or late October," a Kazakh official told Reuters.
CNPC will also pay up to $3 billion to cover half of Kazakhstan's financing of the second phase of Kashagan's development, KazMunaiGas head Sauat Mynbayev told reporters. This phase is expected to start after 2020.
Another draft agreement, seen by Reuters, would guarantee loans from The China Development Bank and The Export-Import Bank of China - worth respectively $3 billion and $5 billion - to Kazakhstan's state holding firm Baiterek, which promotes innovation and industrial projects.
China is already involved in a number of oil projects in its vast resource-rich neighbor, which is five times the size of France but has a population of just 17 million.
This week, Xi visited Kazakhstan's neighbor Turkmenistan, which holds the world's fourth-largest natural gas reserves, and oversaw deals aiming to boost gas supplies and build a pipeline to China.
INDIA'S HOPES DASHED
The Kazakh deal comes after Astana decided in July to use its pre-emptive right to buy an 8.4-percent stake in Kashagan that U.S. oil major ConocoPhillips (COP.N) was selling for $5 billion.
Houston-based ConocoPhillips, whittling down its worldwide portfolio of assets, announced last year it had agreed to sell the stake to ONGC (ONGC.NS), the overseas arm of the Indian state-run company.
The sale to CNPC blocks India's plan to enter Kashagan.
Kazakhstan, home to 3 percent of the world's recoverable oil reserves, has moved in recent years to exert greater management control and secure bigger revenues from foreign-owned oil and gas projects.
KazMunaiGas entered the Kashagan consortium as a shareholder in 2005 and has since then doubled its stake to 16.81 percent.
Kashagan and neighboring fields in the North Caspian hold estimated reserves of 35 billion barrels of oil, with between 9 billion and 13 billion barrels recoverable.
A multinational consortium developing the field has invested some $50 billion in about 13 years, making it the costliest oil project in the world.
Trial runs at the giant reservoir off western Kazakhstan are set to begin on Monday, and it may take between three weeks and a month before commercial production starts, Mynbayev said.
During Kashagan's development, production will be gradually increased to 370,000 barrels per day in the second stage from 180,000 bpd in the first stage in 2013-14, according to North Caspian Operating Company (NCOC), which is developing the field.
(Additional reporting by Raushan Nurshayeva; Writing by Dmitry Solovyov; Editing by Andrew Roche)
Fair Use Notice
This site contains copyrighted material the
use of which has not always been specifically authorized by the copyright
owner. We are making such material available in our efforts to advance
understanding of environmental, political, human rights, economic,
democracy, scientific, and social justice issues, etc. We believe this
constitutes a 'fair use' of any such copyrighted material as provided for
in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C.
Section 107, the material on this site is
distributed without profit to those
who have expressed a prior interest in receiving the included information
for research and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml.
If you wish to use copyrighted material from this site for purposes of
your own that go beyond 'fair use', you must obtain permission from the
Opinions expressed in various sections are the sole responsibility of their authors and they may not represent Al-Jazeerah & ccun.org.
email@example.com & firstname.lastname@example.org