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Kazakhstan's KazMunayGas increases share in Kashagan project

Energy Materials 20 September 2022 10:46
Baku, Azerbaijan Trend News Agency
Kazakhstan's KazMunayGas increases share in Kashagan project

azakhstan's KazMunayGas (KMG) National Company has acquired a 50 percent share in KMG Kashagan B.V. for $3.8 billion, which owns 16.88 percent in the North Caspian Production Sharing Agreement (the Kashagan project), Trend reports citing the company.

The share was acquired from Kazakh Samruk Kazyna Sovereign Wealth Fund.

It is exported that as a result of the increase in the share in the Kashagan project, KMG's consolidated production, EBITDA, net profit and assets will improve. At the same time, the company's debt will also increase.

In 2015 KMG sold a 50 percent share in KMG Kashagan B.V. to the Fund in order to use the proceeds to reduce debt due to a sharp drop in oil prices in those years.

The current buyback was preceded by work targeted to improve the financial stability of KMG, which made it possible to execute this transaction without pressure on credit ratings.

The 50 percent share in KMG Kashagan B.V was earlier subject to a prejudgment attachment, which was lifted by the court of appeal in The Hague, the Netherlands, this year. The subsequent appeal of this decision filed with the Netherlands Supreme Court, cannot affect the buyback of the 50% share by KMG, because the decision of the court of appeal to lift the attachment has immediate effect.

Further details of the transaction will be properly disclosed in KMG's financial statements.

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