Kazakhstan filed lawsuits against operators of two oil fields for $16.5 billion

The Kazakh authorities have filed claims against companies involved in the development of the Karachaganak and Kashagan oil fields in international arbitration. This was told by the head of the Kazakh Ministry of Energy Almasadam Satkaliyev. He did not specify which companies he was talking about, but said that the lawsuits were filed for $3.5 billion and $13 billion.

According to the minister, the reason for going to court was “not tax disputes, we are talking about the implementation of a production sharing agreement.” “The authorized body of the government, the PSA company, filed claims in international arbitration against the companies of Karachaganak and Kashagan … The only thing I can say is that these claims were filed in the interests of the people of Kazakhstan,” Mr. Satkaliyev told reporters (quoted by TASS).

The lawsuits were reported on April 5 by the agency Bloomberg with reference to sources. According to them, the field operators are North Caspian Operating Company (Kashagan) and Karachaganak Petroleum Operating BV (Karachaganak). Both companies have not yet appointed their arbitrators in court. The reason for the lawsuits, as the agency clarifies, was “accusations of unauthorized expenses.” The lawsuit against the operator of Kashagan concerns the period from 2010 to 2018, for Karachaganak – from 2010 to 2019. It is alleged that both companies violated the tender procedures and “did not complete the work of contractors at Kashagan,” Bloomberg interlocutors added.

Laura Keffer