KMG EP receives option to buy 50% of CCPL
JSC KazMunaiGas EP has signed an option agreement with parent JSC National Co., Kazakhstan's state-owned oil company, to acquire a 50% interest in Citic Canada Petroleum by yearend.
LONDON, May 30 -- JSC KazMunaiGas Exploration Production (KMG EP) has signed an option agreement with parent JSC National Co., Kazakhstan's state-owned oil company, to acquire a 50% interest in Citic Canada Petroleum Ltd. (CCPL) by yearend. The purchase would give KMG EP access to oil and gas reserves in Kazakhstan and boost its production.
CCPL's main asset is 94.62% of the share capital and 100% voting control of JSC Karazhanbasmunai (KBM), the large oil and gas company developing Karazhanbas oil field, which has proved reserves of 364 million bbl in western Kazakhstan. In 2006, KBM produced 2.3 million tonnes of oil.
Last December, National Co. acquired the option, which lasts for 1 year, from China's Citic Group when Citic bought CCPL for $1.91 billion.
In a previous interview with OGJ, Askar Balzhanov, chief executive officer of KMG EP, revealed that it was carrying out due diligence for this potential transaction and said KMG EP wants to increase oil production by 50% and boost its reserves by 35-40% (OGJ Online, Mar. 23, 2007).
The boards of KMG EP and National Co. have approved the decision to transfer the option to KMG EP, which has until Sept. 1 to exercise the option.
CCPL previously was called Nations Energy Co. Ltd.
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