ConocoPhillips to sell $5B Caspian Sea stake to Kazakh firm

The Kazakhstan government has chosen its state-run oil and gas company to buy ConocoPhillips’ 8.4-percent stake in a Caspian Sea production sharing agreement instead of the state-run Indian oil company to which ConocoPhillips had planned to sell the asset.

Houston-based ConocoPhillips said Tuesday that the $5 billion it expected to get from the deal with ONGC Videsh won’t change even though the buyer has been switched to KazMunayGas.

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The transaction, which is still subject to further regulatory approval in Kazakhstan, is expected to close in the fourth quarter.

ConocoPhillips said its plan to sell its Kashagan interest in the Kazakhstan sector of the Caspian Sea is intended to return money to shareholders.

“The decision by the Kazakhstan government to exercise its pre-emptive right demonstrates the value of this asset and moves us closer to completing this transaction,” ConocoPhillips executive vice president  Don Wallette said in a statement.