LETTER FROM MS. RACHEL KYTE TO CRUDE ACCOUNTABILITY
October 21, 2005
Ms. Kate Watters
Executive Director
Crude Accountability
PO Box 2345
Alexandria, VA 22301
Dear Kate,
I am writing in response to the queries contained in your letter dated September 29, 2005 in relation to IFC’s investment in the Karachaganak oil and gas condensate field.
1. As you know, under the terms of IFC’s investment agreements, annual monitoring reports (AMRs) are envisaged as portfolio supervision tools, which can cover a number of commercially sensitive areas. IFC’s clients (and, where relevant, their partners) consent to the preparation and provision of the AMRs based on, among other considerations, IFC’s confidentiality undertakings and the clear understanding that these will not be made subject to public circulation. Given this policy background, in the case of Karachaganak, IFC is not in a position to disclose AMRs.
2. Your assertion that “the Kazakhstan Oblast environmental authority denied KPO’s operating license” does not accord with our understanding of the facts. We believe the operating license for the Karachaganak field (No. GKI#98-D(oil), dated November 18, 1997) has not been revoked at any time. We are aware of a delay in the issuance of the project’s environment pollution permit (EPP) for 2005, pending final agreement between KPO and the Kazakhstan authorities on the associated scope of work. However, we understand that, following the signing of a Memorandum of Understanding on June 29, 2005 between the Ministry of Environment, the West Kazakhstan Oblast Akim and KPO, this issue has been resolved and the project currently holds the requisite EPP (No. 270 300 007 850, dated August 8, 2005).
I trust these answers address your questions fully.
Your sincerely,
Rachel Kyte
Director
Environment and Social Development
IFC
Cc: Meg Taylor
Amar Inamdar
Heike Mainhardt
Aleksey Knizhnikov