September 26, 2019 / 2:50 PM / 19 days ago

Kazakhstan considers $1 billion gas plant with Kashagan partners

Kazakh Deputy Energy Minister Murat Zhurebekov speaks during an interview with Reuters in Nur-Sultan, Kazakstan September 26, 2019. REUTERS/Mariya Gordeyeva

NUR-SULTAN (Reuters) - Kazakhstan and a consortium of oil majors developing the giant Kashagan oil and gas field are considering building a $1 billion gas processing plant nearby, Kazakh Deputy Energy Minister Murat Zhurebekov told Reuters on Thursday.

The Central Asian nation has given up the idea of building a similar plant near another large field, Karachaganak, he said.

Zhurebekov said Kazakhstan had not decided how to finance the project, which would have a capacity of 1 billion cubic metres per year using gas from Kashagan, which plans to ramp up its output over the coming years.

“We have not decided whether it would be state funds, private money or money from the national (gas market) operator Kaztransgas,” he said.

Kashagan is being developed by a consortium which includes Eni, ExxonMobil, CNPC [CNPET.UL], Royal Dutch Shell, Total, Inpex and Kazakh state energy firm KazMunayGaz.

The former Soviet republic had been in talks with another group of foreign companies, including Chevron and LUKOIL in addition to Shell and KazMunayGaz, about a similar project linked to the Karachaganak gas condensate field.

But Zhurebekov said the government in Nur-Sultan has given up on the idea because developing Karachaganak would require gas reinjection to further increase condensate production.

Reporting by Mariya Gordeyeva and Alla Afanasyeva; Writing by Olzhas Auyezov; Editing by Alexander Smith

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