France's Total, Areva strike it rich in Kazakhistan

French energy giant Total has signed a heads of agreement for a partnership with  KazMunaiGas (KMG) of Kazakhstan for the development of the Khvalynskoye gas field, located offshore in the Caspian Sea on the border between Kazakhstan and Russia.

The deal is part of 24 agreements worth more than $6 billion French president Nicolas Sarkozy clinched on a vist to Kazakhstan on Tuesday, establishing France as a key investor in the resource-rich state.

Sarkozy also clinched a deal for French nuclear energy group Areva with Kazakh state nuclear company Kazatomprom for setting up a joint venture to market nuclear fuel in Asia.

Kazakhistan has a fifth of global uranium reserves and is on track to become the world's top producer of the radioactive metal this year. But it lacks the technology to process uranium into ready-for-use reactor fuel.

The West sees Kazakhstan, the largest oil producer in the former Soviet Union after Russia, as an increasingly important energy supplier as it ramps up production by tapping new oil and gas fields on its Caspian sea shelf.

Khvalynskoye is a conventional gas condensate field located in water depths of 25 metres which will be developed by Lukoil (50 per cent, operator). The gas produced from this field will be transported to Russia.