In another step towards addressing the energy security concerns, Kazakhstan on Monday agreed to give India 25 per cent stake in its Satpayev oil field, agreement for which will be signed in February.

Giving this information here after a meeting between Kazakhstan Oil and Gas Minister Sauat Mynbayev and Petroleum and Natural Gas Minister Murli Deora, Petroleum Secretary S. Sundareshan said a formal agreement would be signed in February. “Nuts and bolts of the agreement have been discussed and the agreement is in the final stages and we hope to sign it before the end of February 2011,'' he said. The two ministers also held a meeting of the Indo-Kazakhstan Inter-governmental Commission.

Speaking on the occasion, Mr. Sauat Mynbayev said: “India is an important partner for Kazakhstan. Though there are some issues, the agreement for exploration and production contract will be signed by the end of February.''

ONGC Videsh Ltd. (OVL), the overseas arm of ONGC, will invest about $400 million in the prospective Satpayev oilfield in the Caspian Sea. Satpayev is situated in the highly prospective region of North Caspian Sea and in proximity to at least four fields.

A peak output of 2.87 lakh barrels a day is envisaged from the 256-million tonnes of reserves in the field. Kazakh national oil firm KazMunaiGaz will be the operator of the field, holding the remaining 75 per cent stake.

The initial agreement for OVL and its partner Mittal Investment Sarl, getting 25 per cent stake in the Satpayev, was signed during Kazakhstan President Nursultan Nazarbayev's state visit in January 2009 and an exploration and production contract had been under discussion since then.

But in November 2009, Mittal Investment pulled out of the project and OVL decided to take the entire 25 per cent stake on its own. OVL will pay $26 million as signing amount to the Kazakhstan Government. Besides, it will pay $80 million as one-time assignment fee. OVL has also committed a minimum exploration investment of $165 million and an additional optional expenditure of $235 million. The 1,582 sq. km. Satpayev block, situated in the Pre-Caspian Basin of Kazakhstan, holds 1.75 billion barrel of in-place oil reserves.