11 March 2019, ENI Isatay B.V. and KazMunayGaz (KMG) have signed a Joint Operations Agreement and a Finance Agreement within the framework of joint implementation of the offshore Abay project in the Kazakhstan sector of the Caspian Sea.  Based on the agreements signed and in accordance with the provisions of the Kazakhstan Code on the Subsurface, the parties will apply to the Ministry of Energy for permission to conduct direct negotiations and to conclude an E&P contract. The two companies have not released any further details of the new agreements.  The Abay block is in the northern Caspian Sea, at the Precaspian Basinâs southern margin and some 60-70 km north-west of the Buzachi Peninsula. The Isatay exploration block, in which ENI and KMG have 50/50% interests, is situated immediately east of Abay.   In May 2017, KMG published a press release stating that it was looking for a strategic partner to jointly implement the Abay project. The application period was closed at the end of June 2017. In mid-2018, KMG revealed that it was negotiating Abay with ENI, ExxonMobil and Shell.  Background Information  In 2004, seismic data, acquired by KazakhstanCaspiyShelf (KCS), a KMG subsidiary, in the Abay block was re-interpreted. A set of maps (seismic markers P1, VI, V and III) were generated. As the result of the re-interpretation, three prospects were identified â Abay, Abay South and Aliya. Cretaceous (1,300 m) and Jurassic (1,800 m) are the main exploration plays.   Oil in-place resources (P50) are estimated at 607 MMt (4,550 MMb) for Abay, 125 MMt (940 MMb) for Aliya and 28 MMt (210 MMb) for Abay South. KMG had earlier said that a first exploration well should be drilled on the Abay structure and should have a PTD of 2,000 m.   In February 2009, KMG and Statoil (Equinor) signed an MOU starting the two companiesâ negotiations on the Abay block. The parties said they would study geological and technical information and prepare an agreement on the principles of joint work on the Abay project âin the near futureâ.   In June 2010, KMG signed another Abay MOU with Statoil. That MOU envisaged evaluation of E&P projects both in Kazakhstan and abroad, and the Abay block was identified as one such potential project. KMG put forward participation in a âdrilling clubâ as a condition for Statoil to enter the Abay project. The drilling club was supposed to be organised with the purpose to construct and utilise a jack-up drilling rig in the Caspian. Statoil quit the project in February 2013. Statoil quit the project in 2013.  In May 2014, Kazakhstan offered Indiaâs ONGC to take part in the Abay project, but ONGC had concentrated on the Stapayev block instead.
Eni and KMG inked JOFA regarding the Abay project in the Kazakh sector of the Caspian Sea. Both parties will now apply to the authorities for permission to conduct direct negotiations and to conclude an E&P contract.