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Thu 23 Oct 2008 04:00 AM

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Mubadala heads east

Multination JV formed with ConocoPhillips will target Kazakh fields.

National Company KazMunayGas (KMG), ConocoPhillips and Abu Dhabi's Mubadala announced in October that they have signed an MOU to negotiate terms for the exploration and development of the potentially lucrative N Block, located in offshore Kazakhstan, under a new subsoil use contract.

The parties will have until year end to negotiate the definitive agreements for the assignment by KMG of a 49% interest in the subsoil use contract to be shared equally between ConocoPhillips and Mubadala. KMG will remain the majority partner in the venture.

"Mubadala is an active developer in the international energy sector, with a growing portfolio of first-class assets in the upstream oil and gas sector, and this MOU marks another significant step forward for us," said Khaldoon Khalifa Al Mubarak, chief executive officer and managing director, Mubadala Development Company.

"We are excited by the potential of this Kazakh block and the opportunity it provides for us to bring our experience to bear, working together with trusted organizations like KazMunayGas and ConocoPhillips."

"KazMunayGas looks forward to a speedy conclusion to the negotiation and a successful, long-term relationship with both ConocoPhillips and Mubadala. Cooperation with these companies would allow for the attraction of new technologies relating to the exploration and production of oil and gas on the Caspian shelf," said Kairgeldy Kabyldin, president, KazMunayGas.

ConocoPhillips has indicated its excitement at establishing a major new exploration presence in Kazakhstan. "Building on our long-standing participation in the oil and gas sector in Kazakhstan, we will be honoured to participate in the joint venture with this world-class exploration project," said James Mulva, chairman and chief executive officer, ConocoPhillips.

The N Block is located 30 kilometres south-southwest offshore Aktau, Kazakhstan in the Caspian Sea. The Block covers approximately 8100 square kilometres and is considered highly prospective for both oil and gas.

The MOU was signed by Kabyldin, Mulva and Al Mubarak and was witnessed by Sayat Mynbayev, Minister of Energy and Natural Resources of the Republic of Kazakhstan.

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