Kazakhstan said Tuesday it is ready for dialogue with Eni, the Kashagan project operator, aimed at resolving problems over the project's implementation, following Astana's statement last week that it doubts whether the Italian company will be able to comply with the terms of the agreement.
"I had a meeting yesterday with Eni leadership - Mr. [Paolo] Scaroni, in the course of which we discussed matters concerning the future of the Kashagan project. We stated our concern, while Mr. Scaroni presented his view of the issue. In accordance with the contract, we have time to reach an amicable settlement through negotiations, which will continue until October 22," Karim Masimov said.
Masimov said previously that the slow pace of work at Kashagan and the doubling of operation costs threaten serious socio-economic consequences for Kazakhstan.
The government suspended Eni's license to develop the Kashagan oil deposit for three months in late August.
The Kazakh Ministry of Environmental Protection said the operations by Eni, involved in the development of the Kashagan deposit, could cause disastrous environmental damage and destroy local flora and fauna.
In late July, the project operator suggested that the deadline to begin commercial production should be shifted from the second half of 2008 to the second half of 2010, with operating costs increasing from $57 billion to $136 billion.
Kashagan's recoverable reserves were estimated in 2000 at 13 billion barrels of oil.
