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Hemscott / AFX News: Shell declines to comment on impact of Kashagan delay, contract review

LONDON (Thomson Financial) – Royal Dutch Shell PLC would not comment on reports the Kazakhstan authorities will review the Kashagan oil field contract, in which Shell holds a 18.52 pct stake, after operator ENI SpA announced further delays to the project.

A Shell spokesman said he would also not comment on how the impact of the delay — the new start-up date in 2010 is two years later than scheduled — would affect its own production forecasts.

‘On the issue of timing, because we are not the operator we don’t comment,’ he said.

Earlier Prime Minister Karim Masimov said his government will review the Kashagan contract after the Italian oil company last week announced a two-year postponement in the production launch.

And Kazakhstan Energy Minister Baktykozha Izmukhambetov was quoted by Interfax this morning as saying: ‘We are considering increasing the Kazakh share of profit (from the project) from 10 pct to 40 pct’.

Eni is the operator of Kashagan with an about 19 pct stake. Other western stakeholders are Total SA, Shell and ExxonMobil with 18.52 pct each and ConocoPhillips with 9.26 pct. Kazakhstan’s KazMunaiGaz hold 8.33 pct.

Alongside Kashagan, Shell has a 40 pct interest in a joint venture company, as well as a small interest in a pipeline and offshore oilfield in Kazakhstan.

In terms of its strategic interest in the country, the Shell spokesman said: ‘Kazakhstan is key part of our focus on increasing our upstream production’.

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