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Financial Times: Best of enemies

By Paul Betts
Published: October 9 2007 03:00 | Last updated: October 9 2007 03:00

Fate can play funny tricks. Who would have thought of Paolo Scaroni, the former Pilkington boss now running Italy’s Eni oil group, locking horns again with Sir Richard “Dick” Evans, the former head of BAE Systems – and in Kazakhstan of all places?

Mr Scaroni and Sir Richard fell out famously three years ago when the Italian walked out of the BAE board, where he had been serving as a non-executive director. He was highly critical of the UK company’s track record on defence contracts and its dogged pursuit of a transatlantic merger.

Mr Scaroni is now embroiled in another dispute between the Eni-led consortium of oil companies and the Kazakhstan authorities about commercial production delays and cost overruns at the giant Kashagan field. Yesterday he was in Kazakhstan with the Italian prime minister to try to advance a compromise.

That may prove more ticklish than expected. The Kazakhs have recruited a formidable negotiator in Dick Evans. The former BAE boss was last year appointed chairman of Kazakh state holding Samruk, which controls five big companies, including the state oil and gas KazMunaiGaz group.

KazMunaiGaz is part of the Eni-led consortium but has only an 8.3 per cent stake, compared to the 18.5 per cent stakes held by western majors such as Eni, Exxon, Total and Shell. It would probably like a bigger share of the project as well as to play a more prominent management role.

The last time Mr Scaroni was up against Dick Evans, it was easy to get up and walk out. This time round he can hardly afford to slam the door on the world’s biggest oil discovery since Alaska’s Prudhoe Bay.

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Copyright The Financial Times Limited 2007

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