JSC KazMunaiGas Exploration Production announces that it has reached agreements and completed the transactions with Eastern Gate Management Ltd to acquire 100% of LLP 'NBK' ('NBK') and with Halyk Komir LLP to acquire 100% of LLP 'SapaBarlauService' ('SBS').

KMG EP will pay US$ 35m for the 100% stake in NBK and US$ 30m for 100% of SBS. The deals are financed with the Company's own funds.

NBK develops the 'Novobogatinskoe West' field under a Subsoil Exploration and Production Contract expiring in 2027 with an option to extend. The field adjoins the licence area of 'Embamunaigas' and uses its existing infrastructure for oil treating, storage and transportation. Currently, the field is at the production testing stage. In the future, KMG EP plans to merge the assets of NBK with the assets of 'Embamunaigas' in order to realize synergies in exploration and production.

SBS operates under a Subsoil Exploration Contract that expires at the end of 2012. According to KMG EP's geological service, this license area has significant exploration potential in subsalt structures. Accordingly, in the future the Company plans to drill a deep subsalt well.

It should be noted that the assets being acquired are located in a close proximity to the assets of Kazakhoil Aktobe LLP and Kazakhturkmunai LLP, as well as other exploration assets, which may be of interest for KMG EP. The geographical location of the newly acquired assets provides an opportunity for further synergies.

Kenzhebek Ibrashev, the CEO of KMG EP, said, 'KMG EP's exploration strategy and investment decisions, in particular related to drilling of subsalt wells, will be based on comparative analysis of the Company's expanding exploration portfolio. Further to our recently announced acquisitions of shares in JSC Mangistaumunaigas ('MMG'), Kazakhturkmunai Ltd ('KTM') and Kazakhoil Aktobe LLP ('KOA'), we are pleased to announce the acquisitions of 100% stakes in NBK and SBS. These assets will enhance the quality of the Company's onshore exploration portfolio and further strengthen our position as a top oil company in Kazakhstan.'

The acquisitions were unanimously approved by the KMG EP Board of Directors.

Tags: JSC KazMunaiGas Exploration Production