OREANDA-NEWS. On June 04, 2007 Karachaganak Petroleum Operating B.V. (KPO) has announced that the Karachaganak partners have agreed the terms of the Phase III Karachaganak Gas Sales Agreement (GSA) with KazRosGaz, a joint venture between Gazprom and KazMunaiGaz, reported the press-centre of  KPO.

The agreement, which is subject to approvals, sets out the commercial terms governing the sale of gas over a 15 year period commencing during the fourth quarter of 2007. Volumes under the agreement will increase to 16 billion cubic metres per annum (bcma) following completion of the Karachaganak Phase III expansion, which is expected onstream in 2012.

Roger Fox, KPO General Director said: “This agreement is a significant milestone in the continued development of the giant Karachaganak field and represents the commercialisation of over 7 trillion cubic feet of gas. It secures enhanced value for the Karachaganak partners and the Republic of Kazakhstan. Additional gas sales resulting from the expansion will also enable the venture to increase liquids production for export to high value western markets.”

The Karachaganak Phase III expansion project is due to be sanctioned in 2008 and will see gas and liquids sales increase to 16 bcma and 16,5 million tonnes per annum (mtpa) respectively. Currently 8 bcma of untreated Karachaganak gas is exported to the Orenburg processing facility in Russia. The expansion of the Orenburg facility to accommodate the increased volumes as a result of Phase III will be completed by the KazRosGaz joint venture.