Kazakhstan not holding negotiations with Lukoil on buyout of shares in joint projects - energy minister

ASTANA. May 28 (Interfax) - Kazakhstan is not holding negotiations with Lukoil on the buyout of shares in joint projects, Kazakh Energy Minister Yerlan Akkenzhenov said.

"Kazakhstan is not conducting any negotiations with the company Lukoil at the moment," Akkenzhenov told reporters on the sidelines of the Eurasian Economic Forum in Astana.

At the end of January, Akkenzhenov said that Kazakhstan had sent a notification to the U.S. Office of Foreign Assets Control (OFAC) regarding the buyout of the Russian company's share in joint projects, which mentioned the country's preemptive right to buy out shares in joint projects with the company under national legislation.

The ministry was considering buyout options that would not necessarily be tied to payment in cash, he said.

In Kazakhstan, given the imposed sanctions, the implementation of joint projects with Lukoil (Karamkas Sea and Khazar), has been suspended. The Kazakh national company KazMunayGas (KMG) and Lukoil are trying to resolve the issue of financing the further implementation of these projects.

Lukoil has been operating in Kazakhstan since 1995. It holds stakes in major oil and gas production projects such as Karachaganak (13.5% in the operating company Karachaganak Petroleum Operating B.V.), Tengiz (5% in Tengizchevroil LLP) and Kumkol (50% in JSC Turgai Petroleum), and also participates together with Kazakhstan in the Caspian Pipeline Consortium (CPC, Lukoil's share is 12.5%).

The U.S. Treasury added Lukoil to the sanctions list on October 15, issuing a license for winding down operations. At the same time, a number of international projects in Kazakhstan involving Lukoil were immediately exempted from sanctions until October 14, 2027, including the CPC, Tengiz and Karachaganak.