On the ratification of the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea in order to Exercise Sovereign Rights to Subsurface Use and the Protocol to the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea in order to Exercise Sovereign Rights to Subsurface Use

Home / RLA / On the ratification of the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea in order to Exercise Sovereign Rights to Subsurface Use and the Protocol to the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea in order to Exercise Sovereign Rights to Subsurface Use

On the ratification of the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea in order to Exercise Sovereign Rights to Subsurface Use and the Protocol to the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea in order to Exercise Sovereign Rights to Subsurface Use

The Law of the Republic of Kazakhstan dated November 14, 2002 No. 356.

To ratify the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea for the Purpose of Exercising Sovereign Rights to Subsurface Use, concluded in Moscow on July 6, 1998, and the Protocol to the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea for the Purpose of Exercising Sovereign Rights to Subsurface Use dated July 6, 1998 committed in Moscow on May 13, 2002.

President of the Republic of Kazakhstan

Agreement between the Republic of Kazakhstan and the Russian Federation on the delimitation of the bottom of the northern Part of the Caspian Sea in order to exercise sovereign rights to subsurface use

(Official website of the Ministry of Foreign Affairs of the Republic of Kazakhstan - entered into force on May 16, 2003)

The Republic of Kazakhstan and the Russian Federation, hereinafter referred to as the Parties,

considering the mutual interest in creating a legal framework for the activities of both Sides in the development of the subsoil of the northern part of the Caspian Sea,

Striving to ensure favorable conditions for the exercise of their sovereign rights in the Caspian Sea, as well as to resolve in a spirit of mutual understanding and cooperation issues related to the effective use of the mineral resources of the seabed and subsoil of the Northern Caspian,

taking into account the geopolitical changes that have taken place in the region, the growing climate of cooperation, good-neighborliness and mutual understanding between the Parties,

Taking into account that the existing legal regime of the Caspian Sea does not meet modern requirements and does not fully regulate the relations of the Caspian littoral states,

Calling on the Caspian littoral States to conclude as soon as possible, on the basis of their common consent, a Convention on the Legal Status of the Caspian Sea,

guided by the principles and norms of international law, the interests of the Parties in the development and use of the mineral resources of the seabed and subsoil of the northern part of the Caspian Sea,

Based on the understanding that when determining the legal status of the Caspian Sea, the Parties will consider the possibility of establishing border, customs and sanitary control zones, fishing zones within agreed limits, as well as common use zones in its waters.,

Aware of their responsibility to present and future generations for the preservation of the Caspian Sea and the integrity of its unique ecological system,

Considering the importance of existing protected areas for the conservation and restoration of biological resources of the Caspian Sea,

Recognizing the importance of conducting joint scientific research and the need to comply with special environmental requirements in the exploration and development of the mineral resources of the seabed and subsoil of the northern part of the Caspian Sea,

Convinced of the need to develop uniform approaches to the creation of an environmental safety system, including procedures for impact assessment, environmental assessment and control,

proceeding from the fact that the delimitation of the Caspian Sea floor by this Agreement does not apply to biological resources,

Taking into account the bilateral agreements reached on the legal status of the Caspian Sea,

We have agreed on the following:

Article 1

The bottom of the northern part of the Caspian Sea and its subsoil, while maintaining the common use of the water surface, including ensuring freedom of navigation, agreed fishing standards and environmental protection, are delimited between the Parties along a median line modified on the basis of the principle of fairness and agreement of the Parties.

The modified median line is based on an equal distance from the agreed baselines, it includes sections that are not equidistant from the baselines and are determined taking into account islands, geological structures, as well as taking into account other special circumstances and incurred geological costs.

The passage of the modified median line is determined by counting from points on the coasts of the Parties, taking into account the islands, based on the level of the Caspian Sea on January 1, 1998, equal to minus 27 meters of the Baltic Elevation system (relative to the Kronstadt footstock).

The geographical description of the passage of the above-mentioned line and its coordinates will be carried out on the basis of cartographic materials and baselines agreed upon by the Parties and fixed in a separate Protocol, which will be an annex to this Agreement and its integral part.

Article 2

The Parties exercise sovereign rights for the purpose of exploration, development and management of the resources of the bottom and subsoil of the Northern Caspian Sea within their parts of the bottom up to the dividing line.

The Parties have the exclusive right to jointly explore and develop promising structures and deposits if a modified median line passes through them. The share of participation of each of the Parties is determined on the basis of established international practice, taking into account good-neighborly relations between the Parties.

Article 3

A Party or its legal entities and individuals (hereinafter referred to as representatives) that have discovered a hydrocarbon deposit or identified geological structures promising for hydrocarbon accumulation in the northern part of the Caspian Sea in the area of the modified median line before its approval by the Parties have the priority right to obtain a license for their exploration and development with the mandatory involvement of representatives of the other Party.

Article 4

The parties agreed on effective cooperation in the development of export pipelines, the use of river and other transport routes, shipbuilding facilities and other areas.

Article 5

Issues related to freedom of navigation and flights, laying and use of underwater cables, pipelines and other uses of the Caspian Sea will be settled by separate bilateral and multilateral agreements of the Caspian littoral States after the conclusion and on the basis of the Convention on the Legal Status of the Caspian Sea.

Article 6

The Parties protect and preserve the ecological system of the Caspian Sea and all its components. To this end, the Parties shall independently or jointly take all possible measures and cooperate to preserve the biological diversity of the Caspian Sea, prevent and reduce pollution from any source and ensure control over the state of the natural environment of the Caspian Sea.

The Parties prohibit activities that may cause serious damage to the natural environment of the Caspian Sea.

The parties will strive for the early signing by all the Caspian littoral States of an Agreement on the conservation, Reproduction and Rational use of the Biological Resources of the Caspian Sea.

Article 7

This Agreement does not affect the rights and obligations arising from international treaties and agreements, both bilateral and multilateral, concluded separately by each of the Parties.

Article 8

In the event of a dispute between the Parties regarding the interpretation or application of this Agreement, the Parties shall consult with each other with a view to resolving the dispute through negotiation, investigation, mediation, conciliation, arbitration, judicial proceedings or other peaceful means of their own choosing.

Article 9

This Agreement does not prevent the Caspian littoral States from reaching a general agreement on the legal status of the Caspian Sea and is considered by the Parties as part of their general agreements.

Article 10

This Agreement shall be applied temporarily from the moment of signing, taking into account the Protocol provided for in Article 1 of this Agreement, and shall enter into force from the date of the last written notification by the Parties of the completion of the internal procedures necessary for its entry into force.

Done in Moscow on July 6, 1998, in two copies, each in the Kazakh and Russian languages, both texts being equally authentic.

For the Republic

For the Russian

Kazakhstan

The Federation

Protocol

to the Agreement between the Republic of Kazakhstan and

By the Russian Federation on the delimitation of the bottom of the northern part

The Caspian Sea in order to exercise sovereign rights

for subsurface use dated July 6, 1998

Footnote: See the Protocol on Amendments to the Protocol to the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea in order to Exercise Sovereign Rights to Subsurface Use dated July 6, 1998.

The Republic of Kazakhstan and the Russian Federation, hereinafter referred to as the Parties,

in accordance with the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea for the Purpose of Exercising Sovereign Rights to Subsurface Use dated July 6, 1998 (hereinafter referred to as the Agreement),

considering the mutual interest in creating a legal framework for the activities of both Sides in the development of the subsoil of the bottom of the northern part of the Caspian Sea,

striving to create favorable conditions for the joint development of hydrocarbon resources of the geological structures Kurmangazy (Kulalinskaya), Tsentralnaya and Khvalynskoye fields located in the northern part of the Caspian Sea,

based on the need to protect and preserve the ecological system of the Caspian Sea and its biological resources,

have agreed on the following:

Article 1

The modified median line is based on an equal distance from the agreed baselines, it includes areas that are not equidistant from the baselines and are determined taking into account islands, geological structures, as well as taking into account other special circumstances and incurred geological costs.

Article 2

Article 3

Article 4

The parties agreed on effective cooperation in the development of export pipelines, the use of river and other transport routes, shipbuilding facilities and other areas.

Article 5

Article 6

The Parties prohibit activities that may cause serious damage to the natural environment of the Caspian Sea.

The parties will strive for the early signing by all the Caspian littoral States of an Agreement on the conservation, Reproduction and Rational use of the Biological Resources of the Caspian Sea.

Article 7

This Agreement does not affect the rights and obligations arising from international treaties and agreements, both bilateral and multilateral, concluded separately by each of the Parties.

Article 8

Article 9

Article 10

Done in Moscow on July 6, 1998, in two copies, each in the Kazakh and Russian languages, both texts being equally authentic.

For the Republic

For the Russian

Kazakhstan

The Federation

Protocol

to the Agreement between the Republic of Kazakhstan and

By the Russian Federation on the delimitation of the bottom of the northern part

The Caspian Sea in order to exercise sovereign rights

for subsurface use dated July 6, 1998

The Republic of Kazakhstan and the Russian Federation, hereinafter referred to as the Parties,

considering the mutual interest in creating a legal framework for the activities of both Sides in the development of the subsoil of the bottom of the northern part of the Caspian Sea,

based on the need to protect and preserve the ecological system of the Caspian Sea and its biological resources,

have agreed on the following:

Article 1

1. This Protocol establishes the geographical coordinates of the passage of the modified median line of demarcation of the bottom of the northern part of the Caspian Sea between the Republic of Kazakhstan and the Russian Federation for the purpose of exercising sovereign rights to subsurface use.

2. The catalog of geographical coordinates of the turning points of the modified median line of demarcation of the bottom of the northern part of the Caspian Sea is an integral part of this Protocol (Annex 1).

3. The modified median line is plotted in accordance with the catalog on the scheme of delineation of the bottom of the northern part of the Caspian Sea agreed by the Parties (Appendix 2).

4. The starting point of the modified median line is a point with coordinates 46 about 13',3 north latitude and 49 about 26',4 east longitude.

5. The endpoint of the modified median line is a point with coordinates 42 o 33',6 north latitude and 49 o 53',3 east longitude.

This point can be accepted as the junction point of the demarcation lines of the bottom of the Caspian Sea for the purposes of subsurface use between the Republic of Kazakhstan, the Russian Federation and the Republic of Azerbaijan, which will be fixed in a trilateral agreement between them.

6. In the event of the discovery of new geological structures (hereinafter referred to as the structure), the closing isogypses of which will intersect with a modified median line, economic activity on them will be carried out by the economic entities of the Parties on the basis of separate agreements in accordance with Article 2 of the Agreement.

Article 2

The Republic of Kazakhstan exercises sovereign rights to subsurface use at the Kurmangazy (Kulalinskaya) structure. The Russian Federation exercises sovereign rights to subsurface use at the Tsentralnaya structure and the Khvalynskoye field.

Article 3

1. Subsurface use at the Kurmangazy (Kulalinskaya) structure is carried out in accordance with the legislation of the Republic of Kazakhstan.

2. Each of the Parties appoints an authorized organization to jointly develop the resources of the Kurmangazy (Kulalinskaya) structure.

3. A Russian authorized organization has the right to participate in a non-competitive subsurface use project at the Kurmangazy (Kulalinskaya) structure (hereinafter referred to in this article as the project).

4. The authorized organizations of the Parties will sign an agreement on the form of joint activity - a consortium, a commercial organization with foreign investments or any other form of joint activity (hereinafter referred to as the enterprise), including the terms of subsurface use.

5. The share of participation of the Kazakh Side in the project is 50 percent, the share of participation of the Russian Side in the project is 50 percent, provided that:

a) the share of participation of the Kazakh authorized organization in the enterprise is 50 percent;

b) the share of participation of the Russian authorized organization in the enterprise is 25 percent; the option of participation in the enterprise (hereinafter referred to as the option) assigned to the Russian Side is 25 percent;

c) the Kazakh and Russian authorized organizations will have the rights and obligations corresponding to their participation shares, except that prior to the commercial implementation of the option assigned to the Russian Side, the Kazakh and Russian authorized organizations will have equal rights and obligations.

6. The Government of the Republic of Kazakhstan issues subsoil use rights to the enterprise. A production sharing agreement is accepted as a subsurface use contract for the Kurmangazy (Kulalinskaya) structure.

7. No later than six months after the commercial discovery of the deposit, the company will make a commercial offer to the Russian Side to sell the option assigned to the Russian Side. The Russian Side will grant the right to use the option to a Russian organization determined in accordance with the procedure established by the Government of the Russian Federation.

The Russian Side will have the right to accept or reject an offer made within six months after such an offer by the company. If the Russian Side refuses to exercise the option right, the company has the right to freely dispose of the option.

The funds earned from the option will be used by the company for the development of the project.

When exercising the option, the Government of the Republic of Kazakhstan will execute the necessary documents in accordance with the established procedure, ensuring the rights of a new participant in the enterprise.

Article 4

1. Subsurface use at the Tsentralnaya structure is carried out in accordance with the legislation of the Russian Federation.

2. For the joint development of the resources of the Central structure, each of the Parties appoints an authorized organization.

3. A Kazakhstani authorized organization has the right to participate in a non-competitive subsurface use project at the Tsentralnaya structure (hereinafter referred to in this article as the project).

5. The share of participation of the Russian Side in the project is 50 percent, the share of participation of the Kazakh Side in the project is 50 percent, provided that:

a) the share of participation of a Russian authorized organization in the enterprise is 50 percent;

b) the share of participation of the Kazakh authorized organization in the enterprise is 25 percent; the option assigned to the Kazakh Side is 25 percent;

c) the Russian and Kazakh authorized organizations will have the rights and obligations corresponding to their participation shares, except that prior to the commercial implementation of the option assigned to the Kazakh Side, the Russian and Kazakh authorized organizations will have equal rights and obligations.

6. The Government of the Russian Federation grants an enterprise the right to use subsurface resources in the subsurface area within which the Tsentralnaya structure is located for geological exploration, exploration and extraction of minerals without holding an auction for a period of 25 years with a stage of geological exploration of the subsurface for a period of 7 years with the application of the general taxation regime, unless otherwise established by this paragraph.

After completing the stage of geological exploration of the subsurface, the enterprise has the right to continue using the subsurface in the relevant subsurface area with the application of the general taxation regime or to conclude a production sharing agreement with the Government of the Russian Federation in accordance with paragraph 3 of Article 6 of this Protocol.

An enterprise pays a one-time payment established by the legislation of the Russian Federation for the use of subsurface resources for a subsurface area, which is provided for use without an auction for geological exploration of subsurface, exploration and extraction of minerals carried out under a combined license, within 3 months after approval in accordance with the established procedure of the project documentation for the development of a deposit in the subsurface area, within which it is located the structure is "Central".

7. No later than six months after the commercial discovery of the deposit, the company will make a commercial offer to the Kazakh Side to sell the option assigned to the Kazakh Side. The Kazakh Side will grant the right to use the option to a Kazakh organization determined in accordance with the procedure established by the Government of the Republic of Kazakhstan.

The Kazakh Side will have the right to accept or reject the proposal made within six months after such an offer by the enterprise. If the Kazakh Side refuses to exercise the option right, the company has the right to freely dispose of the option.

The funds earned from the option will be used by the company for the development of the project.

When exercising the option, the Government of the Russian Federation will execute the necessary documents in accordance with the established procedure, ensuring the rights of the new participant in the enterprise.

The footnote. Article 4 as amended by the Law of the Republic of Kazakhstan dated July 13, 2016 No. 9-VI.

Article 5

1. Subsurface use at the Khvalynskoye field is carried out in accordance with the legislation of the Russian Federation.

2. Each of the Parties will appoint an authorized organization for the joint development of the oil and gas resources of the Khvalynskoye field.

3. A Kazakhstani authorized organization has the right to participate in non-competitive projects for subsurface use at the Khvalynskoye field.

4. The authorized organizations of the Parties will sign an agreement on the form of joint activity (consortium, commercial organization with foreign investments or any other form of joint activity), including the terms of subsurface use, based on an agreement between them, with the understanding that the participation share of the Kazakh authorized organization can be up to 50 percent.

5. The Government of the Russian Federation issues the rights to subsurface use to a new subsurface user created by authorized organizations of the Parties.

Article 6

During the joint development of the Kurmangazy (Kulalinskaya), Tsentralnaya and Khvalynskoye fields:

1. The boundaries of licensed areas under licenses and contracts issued or concluded by the Parties in accordance with the established procedure in the period prior to the signing of this Protocol shall be drawn in accordance with the modified median demarcation line of the bottom of the northern part of the Caspian Sea, defined by this Protocol.

2. Within one month from the date of signing this Protocol, the Parties will appoint Kazakh and Russian authorized organizations, which, within one month from the date of their respective powers, will begin negotiations on the preparation of relevant agreements on forms of joint activities, including the terms of subsurface use.

3. Based on the legislation of the State exercising sovereign rights to subsurface use, the Parties may conclude production sharing agreements with the relevant enterprise.

4. The right of authorized organizations to assign their share (or part of it) in an enterprise to other legal entities is recognized with the consent of their Government.

In the event of such an assignment, each authorized organization will have a priority right to acquire a share of the organization ceding its share on terms no worse than those offered by other legal entities. This priority right does not apply to assignment to affiliated organizations of an authorized organization, carried out with the consent of its Government and with financial guarantees from the authorized organization.

5. Authorized organizations that do not ensure the fulfillment of their financial obligations stipulated in the agreement on joint activities of the relevant authorized organizations lose their respective shares in favor of authorized organizations that fulfill their obligations in accordance with the terms of the said agreement.

6. If the authorized organizations do not find a mutually acceptable solution within twelve months from the date of signing this Protocol, the Governments of the Parties will appoint other authorized organizations.

Article 7

This Protocol shall enter into force in accordance with the procedure provided for in article 10 of the Agreement of which it is an integral part.

Paragraphs 2 and 6 of Article 6 of this Protocol shall apply provisionally from the date of its signature.

Done in Moscow on May 13, 2002, in two original copies, each in the Kazakh and Russian languages, all texts being equally authentic.

For the Republic

For the Russian

Kazakhstan

The Federation

Appendix 1 to the Protocol to the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea for the Purpose of Exercising Sovereign Rights to Subsurface Use dated July 6, 1998

Catalog of geographical coordinates of the turning points of the modified median line of demarcation of the bottom of the northern part of the Caspian Sea

The numbers of the turning points of the modified median line

Northern latitude

Eastern longitude

46°13',3

49°26',4

46°11',6

49°30',4

46°10',8

49°32',7

46°10',6

49°36',0

46°10',7

49°37',3

46°11',2

49°42',1

46°10',6

49°42',6

46°09',7

49°43’,6

46°09',4

49°43',9

46°07',1

49°46',7

46°05',1

49°49',7

46°04',2

49°51',0

46°00',1

49°57',1

45°59',1

50°01',0

45°21',5

49°25',5

45°21',3

49°25',0

45°17',3

49°21',2

45°13',5

49°17',8

45°12',3

49°16',7

45°05',9

49°10',5

45°02',4

49°10',4

44°55',1

49°09',9

44°50',0

49°09',8

44°40',6

49°09',3

44°25',4

49°08',0

44°20',0

49°05',3

44°20',0

49°36',0

44°04',0

49°36',0

44°04',0

49°00',0

43°19',2

49°00',0

43°17',0

49°20',1

43°16',5

49°20',6

43°15',8

49°21',4

43°11,6

49°27',0

43°10',3

49°27',9

43°08',2

49°29',5

43°07',8

49°29',9

42°45',0

50°00',0

42°33',6

49°53',3

Appendix 2 to the Protocol to the Agreement between the Republic of Kazakhstan and the Russian Federation on the Delimitation of the Bottom of the Northern Part of the Caspian Sea for the Purpose of Exercising Sovereign Rights to Subsurface Use dated July 6, 1998

The scheme of delineation of the bottom of the northern part of the Caspian Sea along a modified median line for subsurface use

President

Republic of Kazakhstan

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