UK's BG to pursue new gas projects in Kazakhstan

ALMATY Oct 8 (Reuters) - Britain's BG (BG.L) teamed up with Kazakh state oil and gas company KazMunaiGas on Wednesday to jointly develop new gas projects in Kazakhstan including power generation and production of gas powered vehicles.

BG is co-leading the development of the huge Karachaganak oil and gas field in Kazakhstan along with Italy's Eni (ENI.MI). The British company said earlier this week it was eyeing ways to expand its presence in Central Asia's biggest oil producer.

Clare Young, commercial manager of BG Kazakhstan's downstream business, said BG had signed an agreement with KazMunaiGas [KMG.UL] earlier in the day to form a joint working group to explore opportunities in the natural gas market.

"KMG (KazMunaiGas) asked us two years ago to develop the gas markets in Kazakhstan," she told an annual oil and gas conference in the Kazakh financial capital Almaty.

"In 2007 BG produced a study with a number of opportunities to produce natural gas in Kazakhstan. These opportunities include the development of natural gas vehicles, natural gas trains, natural gas power and co-generation."

BG was one of the first Western energy majors to enter the Kazakh market in the 1990s shortly after the Central Asian nation gained independence from the Soviet Union. (Reporting by Amie Ferris-Rotman; Writing by Maria Golovnina)