KazMunaiGas Finalizes Transaction for Ural Stake

KazMunaiGas Finalizes Transaction for Ural Stake

Tuesday, April 19, 2011

JSC KazMunaiGas Exploration Production

KazMunaiGas announced the closing of the transaction to acquire a 50% stake in Ural Group Limited (UGL) from Exploration Venture Limited (EVL). UGL owns the exploration license for the block Fedorovskiy through 100% stake in LLP "Ural Oil and Gas" (UOG).

As previously announced, the deal price was subject to adjustment for EVL's work program financing obligations until the deal close. The final acquisition price is US $164.4m, including US $61.3m for shares and US $87.8m of shareholder loans (as of January 1, 2010) and US $15.3m - adjustment for EVL's work program financing until the deal close (2010 and 1Q11).

Earlier the acquisition was approved by the Board of Directors of KMG EP and the Board of Directors of EVL. All regulatory approvals have also been received.

KazMunaiGas Scoops Up 4 Blocks

KazMunaiGas Scoops Up 4 Blocks

Monday, April 11, 2011
JSC KazMunai Gas Exploration Production

KazMunaiGas announced agreements reached with the JSC National Company KazMunayGas ("NC KMG") to acquire four hydrocarbon exploration contracts.

As per the agreement, KMG EP acquires the following four contracts: Temir, Teresken, Karaton-Sarkamys and the territory adjacent to Uzen and Karamandybas.

Temir and Teresken blocks are located in the Aktobe region in close proximity to the assets of Kazakhoil Aktobe LLP and Kazakhturkmunai LLP, as well as other assets, which may be of interest to KMG EP. The geographic location of the contract area has several advantages, including infrastructure and logistics.

The territory adjacent to Uzen and Karamandybas is located in the area of operations of Uzenmunaigas production facility. Block Karaton-Sarkamys is located in the Atyrau region 100km south-west of the Kulsary deposit in the area of operations of Embamunaigas production facility.

The acquisition cost of the four contracts is USD $40 million. The transactions will be financed from KMG EP's own funds.

According to the Company's estimates, the geological resources on four blocks are around 1.5 billion barrels of oil equivalent.

The terms of the contracts on the territory adjacent to Uzen and Karamandybas, Karaton-Sarkamys block and Temir, is 6 years from 2010, with the right of extension until 2019. With regard to the Teresken block, the license is for 6 years, starting in 2006, with the right of extension until 2015.

Significant synergies can be achieved through the use of the existing infrastructure of Embamunaigas and Uzenmunaigas production facilities in Atyrau and Mangistau regions, which will help to optimize capital and operating costs.

It is anticipated that the acquired assets will enhance the quality of the Company's on-shore projects portfolio and, in case of successful exploration, will increase the Company's recoverable reserves in the medium term, including Uzen and Emba groups of fields.

Askar Balzhanov, CEO of KMG EP, said, "The acquisition of these contracts is another step towards the implementation of the Company's strategy to grow via acquisitions and expansion of exploration. KMG EP has repeatedly stated its intention to purchase these four blocks, and now the agreement is reached. The Company will continue its search for highly promising assets, acquisition of which will serve the interests of all shareholders."

The acquisition was approved by the Board of Directors of KMG EP and the Board of Directors of NC KMG. Approvals of the Government regulators have been received.

The closing of the deal is expected in the second quarter of the current year.

KazMunaiGas to Acquire 4 Exploration Contracts

KazMunaiGas to Acquire 4 Exploration Contracts

Monday, April 11, 2011
JSC KazMunai Gas Exploration Production

KazMunaiGas announced agreements reached with the JSC National Company KazMunayGas ("NC KMG") to acquire four hydrocarbon exploration contracts.

As per the agreement, KMG EP acquires the following four contracts: Temir, Teresken, Karaton-Sarkamys and the territory adjacent to Uzen and Karamandybas.

Temir and Teresken blocks are located in the Aktobe region in close proximity to the assets of Kazakhoil Aktobe LLP and Kazakhturkmunai LLP, as well as other assets, which may be of interest to KMG EP. The geographic location of the contract area has several advantages, including infrastructure and logistics.

The territory adjacent to Uzen and Karamandybas is located in the area of operations of Uzenmunaigas production facility. Block Karaton-Sarkamys is located in the Atyrau region 100km south-west of the Kulsary deposit in the area of operations of Embamunaigas production facility.

The acquisition cost of the four contracts is USD $40 million. The transactions will be financed from KMG EP's own funds.

According to the Company's estimates, the geological resources on four blocks are around 1.5 billion barrels of oil equivalent.

The terms of the contracts on the territory adjacent to Uzen and Karamandybas, Karaton-Sarkamys block and Temir, is 6 years from 2010, with the right of extension until 2019. With regard to the Teresken block, the license is for 6 years, starting in 2006, with the right of extension until 2015.

Significant synergies can be achieved through the use of the existing infrastructure of Embamunaigas and Uzenmunaigas production facilities in Atyrau and Mangistau regions, which will help to optimize capital and operating costs.

It is anticipated that the acquired assets will enhance the quality of the Company's on-shore projects portfolio and, in case of successful exploration, will increase the Company's recoverable reserves in the medium term, including Uzen and Emba groups of fields.

Askar Balzhanov, CEO of KMG EP, said, "The acquisition of these contracts is another step towards the implementation of the Company's strategy to grow via acquisitions and expansion of exploration. KMG EP has repeatedly stated its intention to purchase these four blocks, and now the agreement is reached. The Company will continue its search for highly promising assets, acquisition of which will serve the interests of all shareholders."

The acquisition was approved by the Board of Directors of KMG EP and the Board of Directors of NC KMG. Approvals of the Government regulators have been received.
The closing of the deal is expected in the second quarter of the current year.

Statoil, KazMunaiGas Team Up in Caspian Sea JV

Statoil, KazMunaiGas Team Up in Caspian Sea JV

Wednesday, March 30, 2011

Statoil

Statoil and KazMunaiGas have signed the Heads of Agreement (HoA) on the Abay block in the Kazakhstani sector of the Caspian Sea.

Under the HoA, the parties plan to conduct evaluation of the hydrocarbon potential of the Abay block in the Northern Caspian Sea. Statoil and KazMunaiGas will jointly establish a company that will serve as operator of the project. The exploration work program will cover seismic surveys, data acquisition and the drilling of one exploration well.

"Joint cooperation in the Abay block is an important strategic step for Statoil as we continue our international growth. This agreement marks an important milestone in Statoil's re-entry into Kazakhstan and I am very pleased that we have strengthened our partnership with KazMunaiGas," said Tim Dodson, executive vice president for Exploration in Statoil.

In addition to the work program the joint operating company will participate in social investment projects including training of local personnel. Statoil will provide financial and technical assistance to KazMunaiGas' project to build, own and operate a jack-up drilling rig for the use in the Caspian Sea.

"We are interested in cooperation with Statoil in attracting and using their experience and technologies in operating international offshore oil and gas projects. The HoA signing confirms the intentions of the parties about the strategic partnership of our two companies on the joint activities in the Caspian Sea," said Kairgeldy Kabyldin, Chairman of the management board of JSC NC KazMunaiGas.

The Abay block is located 65 km from the shore, at a water depth of 8-10 meters.