Eni, KMG to explore Isatay Block in Caspian Sea

MILAN, Italy -- Eni and KazMunayGas (KMG) have finalized an agreement that defines the commercial terms of the transfer to Eni of 50% of the subsoil use rights in the Isatay Block in the Kazakh Caspian Sea.

Isatay Block is estimated to have significant potential oil resources and will be operated by a joint operating company established by KMG and Eni on a 50/50 basis. The operating company will benefit from Eni’s proprietary technology, industry-leading track record in exploration and extensive experience in the environmentally and technically challenging conditions of the Caspian Sea shelf.

The agreement signals the successful completion by KMG of the requisite procedures under Kazakh laws to acquire subsoil use rights in the Isatay Block and the finalization of related commercial agreements, which will result in the transfer to Eni of 50% of the subsoil use rights and regulate the performance of the joint operations. The transfer is expected to be completed within a few months, subject to the approval of the transaction by the Republic of Kazakhstan.

The terms of Eni’s participation in the Isatay Block were signed last year as part of a strategic agreement between Eni and KMG, which also involves the joint development of a shipyard project in Kuryk, on the Caspian Sea coast of the Mangystau region.