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. Last Updated: 07/27/2016

Caspian Oil Tender Disputed

ALMATY -- Kazakhstan's Foreign Ministry has expressed "strong disagreement" with Russia's plans to hold a tender for the exploration of huge oil and gas riches on the part of the Caspian Sea shelf that it considers its own.


"The Foreign Ministry is authorized to express its strong disagreement with the holding of the tender, to declare the inadmissability of unilateral actions, not coordinated with Kazakhstan, held on its territory and the necessity to reconsider the decision taken," it said in a statement.


It said it had information that Russia's Natural Resources Ministry had announced a tender for the right to explore mineral resources in the Caspian Sea.


The tender results are to be announced in the Black Sea town of Gelendzhik in October, the statement said.


"From the location of the blocks put up in the tender it is clear that some of them are in Kazakhstan's sector of the Caspian Sea," it said.


Kazakh Foreign Minister Kasymzhomart Tokayev told a news conference earlier this week that the results of the tender could be announced Oct. 2 and added: "The larger part of the blocks lie in our national sector and it is impossible to hold this tender."


The five littoral states -- Russia, Iran, Kazakhstan, Azerbaijan and Turkmenistan -- have strong economic interests in the Caspian Sea holding huge reserves of oil and natural gas.


Kazakhstan's reserves in the sector it considers its own are roughly estimated at 10 billion metric tons of crude and 2 trillion cubic meters of natural gas.


But development of the Caspian's riches is being thwarted by disputes about which area of the sea belongs to each state.


Russia and Iran say the oil belongs to all five littoral states, while the other three countries have divided the Caspian into sections and proceeded to develop their own areas.


In the most recent and vivid example of the tug-of-war for Caspian resources, Turkmenistan secured property rights over the Serdar oil field.


The field, containing estimated reserves of 50 million metric tons of oil, had been targeted for joint exploitation by Azerbaijan's state oil company SOCAR, Russia's largest oil firm LUKoil and state oil company Rosneft.


SOCAR signed a contract with LUKoil and Rosneft in July but the deal was cancelled earlier this month by President Boris Yeltsin, who declared it null and void after talks with Turkmen President Saparmurat Niyazov.


Turkmenistan was to have launched the first round of an international tender Monday for the exploration and development of oil and gas deposits in its sector of the Caspian Sea, Interfax reported.


About 25 percent of the 70,000-square kilometer Turkmen sector will be included in the first round, officials on a council organizing the tender in the Central Asian republic's capital, Ashgabat, said.


The tender includes fields in the South Caspian depression and middle Caspian geological block.


Applications to bid in the tender will be accepted until Nov. 28, and the first round winners are expected to be announced Jan. 1.