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Strategies & Market Trends : Ride the Tiger with CD -- Ignore unavailable to you. Want to Upgrade?

To: Claude Cormier who wrote (100184)	12/1/2007 10:22:43 PM
From: Condor	Respond to of 313017

UPDATE 1-Kashagan deal to be agreed by Dec. 20-consortium Sat Dec 1, 2007 3:25pm GMT ASTANA/MILAN, Dec 1 (Reuters) - Kazakhstan and the operators of its giant Kashagan oil field have set Dec. 20 as the deadline for a final deal to end their long-running dispute over massive costs and compensation after sorting out a framework agreement. In a statement on Saturday, the consortium of western companies led by Italian oil and gas giant Eni (ENI.MI: Quote, Profile, Research) said "good progress" had been made in talks, which had faced a deadline of Nov. 30. The group said a memorandum of understanding had been signed between all parties which "establishes the framework of a settlement ... and sets Dec. 20 as the deadline to finalise its terms." The landlocked oil and gas producing nation, five times the size of France, has been arguing for months with the western companies over cost overruns and production delays at the huge Caspian Sea field -- the biggest oil find in three decades. A source close to the talks said on Friday Kazakhstan was seeking $7 billion in compensation for delays at Kashagan -- a fine much smaller than earlier demands of over $10 billion. Kazakhstan has also been pressing for state-owned KazMunaiGas to be joint operator for the consortium, which includes Royal Dutch Shell Plc (RDSa.L: Quote, Profile, Research), Exxon Mobil Corp (XOM.N: Quote, Profile, Research), Total (TOTF.PA: Quote, Profile, Research), Conoco Phillips (COP.N: Quote, Profile, Research) and Japan's Inpex Holdings Inc (1605.T: Quote, Profile, Research). Kazakh State Secretary Kanat Saudabayev said equal weight needed to be given to its interests. "A time has come now when we consider it necessary to establish a parity between Kazakhstan's interests and the interests of our foreign partners, including on the Kashagan issue," he told journalists. The mammoth field, at the heart of Kazakhstan's ambitious plans to triple oil output by 2017, is due to start pumping oil in 2010, instead of the original 2005 target. Its costs have escalated to $136 billion, from $57 billion. (Reporting by Maria Golovnina and Raushan Nurshayeva; Writing by Dmitry Solovyov and Jo Winterbottom; Editing by Michael Winfrey and Tony Austin)