India shocked by Kazakhstan's decision on Kashagan

04 july 2013, 18:38
India shocked by Kazakhstan's decision on Kashagan - Kashagan oil field. ©REUTERS
Kashagan oil field. ©REUTERS
Indian Foreign Ministry plans to discuss cooperation in energy with Kazakhstan government after Kazakhstan refused to support the Kashagan bid of Indian company Oil & Natural Gas Corp (ONGC), The Wall Street Journal writes.

According to an informed source, ONGC was shocked by Kazakhstan’s decision and asked Kazakhstan government for explanations. “Following the decision taken by the Kazakhstan government, we got in touch with the Kazakhstan government to discuss future prospects of our energy cooperation," said Foreign Ministry’s representative Syed Akbaruddin.

The Indian officials have accepted that Kazakhstan may reject the ONGC bid to procure the 8.4-percent stake of ConocoPhillips. But they say that the unexpected intrusion of the Kazakhstan government interfered with India’s intentions to expand its access to foreign energy resources, which is especially important for it since the country buys 80 percent of crude oil from abroad.

"This is not fair. India has a right to get an explanations of their decision to preempt the bid," the source said.

ConocoPhillips will sell its stake in Kashagan to KazMunaiGas for $5 billion. Earlier Kazakhstan Ministry of Oil and Gas Ministry notified ConocoPhillips of Kazakhstan's intention to exercise its preemptive right to purchase the stake in Kashagan and the North Caspian Sea Production Sharing Agreement.

India and China were planning to buy a minority stake in Kashagan oil and gas field in Kazakhstan from ConocoPhillips. ONGC Videsh Limited planned to spend $5.5 billion, while China’s CNPC was offering to buy ConocoPhillips’ stake in Kashagan from KazMunaiGas for $5 billion.

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