(Recasts with the venture statement)
ALMATY, June 6 The troubled Kashagan oil
development has named an executive from U.S. firm Exxon Mobil
to run the venture while also streamlining its
complicated structure in an attempt to fix the beleaguered $50
billion project offshore Kazakhstan.
The group said on Friday Stephane de Mahieu, an Exxon
secondee, had become managing director as of May 1, 2014.
However, it denied a report in industry publication Nefte
Compass that Exxon would take over as operator of Kashagan
saying that instead all seven oil firms involved will be
effectively operators through a rejigged venture.
"The appointment of an ExxonMobil secondee to managing
director does not mean that Exxon is taking over the
operatorship of North Caspian Sea Production Sharing Agreement,"
a spokesman for the venture Hans Wenck said.
After delays and cost overruns, production at Kashagan - one
of the world's biggest finds of the past decades - finally
started last September but was halted in early October after the
discovery of gas leaks in the pipeline network.
Oil output may not restart until early 2016, Kazakh
officials said in May, urging foreign partners to start
replacing leaky pipelines at the deposit.
Italy's Eni was given the job of operating the
project in 2001. It later lost its role as the sole lead
operator following major delays and cost overruns.
The Kashagan shareholders are Eni, Exxon Mobil, Royal Dutch
Shell, France's Total and Kazakh state oil
company Kazmunaigas, each with 16.8 percent, and Japan's Inpex
and China National Petroleum Corp. (CNPC) as junior
The seven firms will continue to oversee the managing
But under the new scheme, the reformed joint venture, run by
the managing director, will be responsible for drilling,
development and production at the same time, whilst in the past
those responsibilities were split in a complicated way between
Eni, Kazmunaigas, Shell and Exxon.
No changes to the production sharing agreement or the
project's ownership structure are envisioned as a result of the
planned transition, the venture said in a statement.
Working "under one umbrella" means that workflows will be
more efficient, Wenck said.
The field was meant to be producing 370,000 barrels per day
at the peak of the first phase which is likely to be achieved
only a few years after the field restart.
(Reporting by Dmitry Zhdannikov in London and Dmitry Solovyov
in Almaty, editing by William Hardy)