Kazakhstan takes global majors to court over oilfield revenues

Kazakhstan on Tuesday said it had begun international arbitration court proceedings against energy majors including ExxonMobil and Shell over $16.5 billion (15.2 billion euros) in costs deducted from the revenues from two oilfields.

The government "has begun international arbitration against the Karachaganak and Kashagan (operating) companies," Energy Minister Almasadam Satkaliev was quoted by the official news agency Kazinform as saying, adding that "the sums are $3.5 billion and $13 billion".

Kashagan, which lies in the northern part of the Caspian Sea, is one of the world's largest offshore fields, with estimated reserves of 13 billion barrels of oil.

Discovered in 2000, the oil field has faced endless delays owing to technical problems.

Kazakhstan last month filed a claim against the field's operator for environmental protection fines for allegedly violating rules on sulphur storage at the site.

The field is run by the North Caspian Operating Company, which is made up of KazMunayGaz, Eni, ExxonMobil, Royal Dutch Shell, TotalEnergies, China National Petroleum Corporation and Inpex.

Eni, Shell and KazMunayGaz also operate the Karachaganak field in western Kazakhstan, along with Chevron and Lukoil.

The operating companies have been able to deduct certain costs from revenues before dividing it with the government under production sharing agreements.

 

AFP