"Yesterday and today we debated the point, with Chevron saying it would ensure that Kazakhstan's budget does not lose $600 million, and we would agree to proceed with expansion works," Nazarbayev told reporters after chairing a meeting of investors, the Foreign Investors' Council, in the new capital.
"I believe we will reach a consensus in the nearest future." Nazarbayev has personally supported the venture, set up in 1993 and often highlighted as an investment success story and a beacon for Western businesses. But he has made it clear Kazakhstan would not back down in the dispute with TCO. "They have proposed reinvesting their profits in the expansion. Among other things, this means fast amortization, and Kazakhstan's budget may lose $600 million in the next three years," he added. "Such is the situation."
The joint venture's expansion plan aims to double output to 440,000 barrels per day after 2005 from this year's expected 254,000 bpd.
TCO is led by ChevronTexaco with 50 percent; KazMunaiGaz holds 20 percent, ExxonMobil 25 percent, and LUKArco 5 percent.
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