BG Group announced recently that it has agreed to sell half of its interest in the North Caspian Sea Production Sharing Agreement (PSA) to CNOOC North Caspian Sea, a wholly owned subsidiary of CNOOC Ltd of China, for $615 million.
Under the agreement, CNOOC Ltd will acquire a one twelfth (8.33%) interest in the PSA, which covers 5,600 square kilometres of the Kazakhstan section of the Caspian Sea. Following the sale, BG will retain a one twelfth (8.33%) interest.
Completion of the transaction, expected during 2003, is subject to a number of conditions, including approval from the Kazakhstan authorities and the existing PSA partners waiving pre-emption rights.
The North Caspian Sea PSA includes the Kashagan oil field, the Kalamkas oil discovery and the Kairan, Aktote and Kashagan SW prospects, and is operated by ENI, which holds a 16.67% interest. The other partners are ExxonMobil, Shell and TotalFinaElf, each with 16.67% interest, and ConocoPhillips and INPEX, each with 8.33%.