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The Guardian: Kazakhstan to abandon PSAs, respect current deals

Reuters
Thursday February 21 2008
(Adds quotes, details, background)

ASTANA, Feb 21 (Reuters) – Kazakhstan will stop using production sharing agreements (PSAs) as a form of cooperation with companies seeking to tap its vast energy and metals reserves, Prime Minister Karim Masimov said on Thursday.

Kazakhstan has been toughening its energy policy over past years, alarming foreign investors who see its new-found assertiveness as part of the growing global trend of resource nationalism.

Masimov, addressing a meeting with tax officials, said the oil-rich Caspian nation will remain committed to contractual obligations stipulated in all existing PSAs with foreign and domestic companies.

“For new contracts we ought to exclude production sharing agreements as a type of contract,” Masimov said.

“Kazakhstan will continue to fulfil its obligations for those contracts that have already been signed,” he added.

He did not describe a type of contract Kazakhstan wanted to use with oil and metals companies from now on, but said taxes should be increased for all subsoil companies.
Kazakhstan’s biggest oilfields such as Kashagan, Tengiz and Karachaganak, are all being developed by Western oil majors including Italy’s Eni, Exxon Mobil, and Royal Dutch Shell. Kashagan and Karachaganak are PSAs, while Tengiz is based on a concession agreement.

(Reporting by Raushan Nurshayeva; Writing by Maria Golovnina, editing by Jacqueline Wong)

http://www.guardian.co.uk/feedarticle?id=7325938

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