business

KazMunaiGaz Said to Plan Joint Venture With BG in North Sea

Kazakhstan’s state-owned oil producer plans to set up a joint venture with BG Group Plc in the North Sea as part of an international expansion drive, two people familiar with the situation said.

KazMunaiGas Exploration Production, the London-traded arm of KazMunaiGaz National Co., and BG are in talks, according to the people who declined to be identified because the negotiations are private.

The North Sea is the largest oil and gas producing region in Europe, with about 20 billion barrels of hydrocarbon resources yet to be tapped, according to industry estimates. In 2008, KazMunaiGaz and BG agreed to study possible exploration and production opportunities.

Jo Thethi, a spokeswoman for Reading, England-based BG, wasn’t immediately available. Alexander Gladyshev, a managing director for investor relations at KazMunaiGas EP, declined to comment.

KazMunaiGaz Chief Executive Officer Kairgeldy Kabyldin said June 3 that the company was seeking to acquire 10 percent of the country’s Karachaganak oil and gas venture, of which BG is a partner.

On July 28, BG CEO Frank Chapman said that the Kazakh government hadn’t offered to buy a stake the field. The planned expansion of the field has been held up by tax disputes between international companies including BG and Eni SpA, and the Kazakh government.

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