Photo: Tass

Astana had signed a preliminary agreement with the Karashyganak Petroleum Operating (KPO) consortium, which involves paying 1,1 billion dollars in compensation to the government of Kazakhstan.

Between the republic and the consortium there were disagreements "by the method of calculating the shares of the parties in the section of profitable products", in connection with which the republic filed a lawsuit in international arbitration.

The October 1 on the distributed report of the Ministry of Energy of Kazakhstan said that the parties in the negotiation process had found a mutually beneficial way to resolve the dispute amicably.

In addition to the payment by the consortium of compensation, the agreement involves the introduction of changes in the mechanism of production sharing, the obligations of the consortium for the implementation of investment projects. The consortium also reportedly will provide the republic with a long-term loan for a period of 10 years “for the construction of an infrastructure project in the amount of one billion dollars, or pay the equivalent value of the loan (in the event of the republic’s refusal to borrow) in the amount of about 200 million dollars.

As stated  by the Minister of Energy of Kazakhstan Kanat Bozumbayev, the basic principles of the settlement are currently agreed, it is expected that the final agreement will be signed before the end of this year.

"The Qazaq Times"