Statoil and KazMunayGas have signed the Heads of Agreement (HoA) on the Abay block in the Kazakhstani sector of the Caspian Sea.

Under the HoA, the parties plan to conduct evaluation of the hydrocarbon potential of the “Abay” block in the Northern Caspian Sea. Statoil and KazMunayGas will jointly establish a company that will serve as operator of the project. The exploration work programme will cover seismic surveys, data acquisition and the drilling of one exploration well.

“Joint cooperation in the Abay block is an important strategic step for Statoil as we continue our international growth. This agreement marks an important milestone in Statoil’s re-entry into Kazakhstan and I am very pleased that we have strengthened our partnership with KazMunayGas,” says Tim Dodson, executive vice president for Exploration in Statoil.

In addition to the work programme the joint operating company will participate in social investment projects including training of local personnel. Statoil will provide financial and technical assistance to KazMunayGas’ project to build, own and operate a jack-up drilling rig for the use in the Caspian Sea.

“We are interested in cooperation with Statoil in attracting and using their experience and technologies in operating international offshore oil and gas projects. The HoA signing confirms the intentions of the parties about the strategic partnership of our two companies on the joint activities in the Caspian Sea” says Kairgeldy Kabyldin, Chairman of the management board of JSC NC “KazMunayGas”.

The “Abay” block is located 65 km from the shore, at a water depth of 8-10 meters.

Source: statoil , March 30, 2011;