LONDON, June 18 -- TotalFinaElf SA Monday clinched deals with BP PLC and Norway's Statoil AS to buy their respective shares in the North Caspian Sea production sharing agreement, which covers the giant Kashagan oil field off Kazakhstan.
Terms of the deals were not disclosed. TotalFinaElf said it will get BP's 9.52% stake and Statoil's 4.76% interest. The purchases fit its strategy of increasing its position in the Caspian region, "particularly" in Kazakhstan.
Meanwhile, Scott Kerr, BP's Kazakhstan Business Unit leader, said the British major sold its stake in Kashagan because the field was not part of its forward production profile, noting that the move would help toward the consolidation of smaller interests in the license group.
"Besides being in our own interest, we see our move as entirely helpful and beneficial to the venture," said Kerr.
Kerr added that BP "remained committed" to Kazakhstan via its stakes in Tengiz field, and the recently opened Caspian Pipeline Consortium trunkline.
Kashagan is in the North Caspian Sea consortium's 11-block PSC area. Following two successful exploration wells, Kashagan's potential reserves are estimated at 10 billion bbl.
TotalFinaElf said Monday that the first well of the appraisal drilling campaign was underway, with "several promising exploration prospects" still to be drilled.
The deals with BP and Statoil will increase the TotalFinaElf stake to 18.56% from 14.28%. Other partners are operator ENI SPA with 14.28%, BG PLC 14.28%, ExxonMobil Corp. 14.28%, Royal Dutch/Shell Group 14.28%, Inpex Masela Ltd. 7.14%, and Phillips Petroleum Co. 7.14%.
TotalFinaElf noted that the partners have a preemption right that gives them the option to share in a percentage of BP's and Statoil's interests.