The consortium of international oil majors have decided to significantly cut costs to develop the Kashagan oil field in the Caspian Sea, Kazakh state oil and gas company KazMunaiGas said Thursday.

"The global economic crisis has had a substantial impact on the global market which will affect the (Kashagan) project participants' obligations," KazMunaiGas, or KMG, said in a statement.

"This decision is expected to significantly cut project expenditures for Kazakhstan and the Kashagan consortium members while abiding by a development timeframe and deadline for the start of production at the (Kashagan) oil field."

Company Web site: www.kmg.kz

-By Kadyr Toktogulov, Dow Jones Newswires; +7 701 726 4327, kadyr.toktogulov@dowjones.com