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Bloomberg: Kazakhstan Seeks to Double Kashagan Oil Project Stake to 16.8%

By Nariman Gizitdinov

Dec. 25 (Bloomberg) — Kazakhstan is seeking to more than double its stake in the Eni SpA-led Kashagan oil project as compensation for delays and cost overruns.

The Central Asian country’s government is seeking to raise its stake to 16.8 percent, Dinara Shaimardanova, an aide to Energy Minister Sauat Mynbayev, said today by phone from the Kazakh capital, Astana. The state currently holds 8.3 percent.

The government has disputed a second delay to the start of production at Kashagan, the world’s biggest oil discovery in 30 years, and an increase in costs that it says have more than doubled the price for developing and running the field to $136 billion.

Kazakhstan and the group of companies led by Eni extended talks on the dispute until Jan. 15 as Exxon Mobil Corp. opposes the increase of the Kazakh stake, Shaimardanova said yesterday.

Eni, Exxon, Total SA and Royal Dutch Shell Plc all hold 18.5 percent of Kashagan, while ConocoPhillips has 9.3 percent. KazMunaiGaz National Co., Kazakhstan’s state-run oil producer, and Japan’s Inpex Corp. each own 8.3 percent.

To contact the reporter on this story: Nariman Gizitdinov in Almaty, through the Moscow newsroom at [email protected]

Last Updated: December 25, 2007 03:37 EST 

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