Kazakhstan to see arbitration decision on Karachaganak by year's end

Yerlan Aktenzhenov, Kazakhstan's Energy Minister, said on Monday that a decision in the arbitration?case involving a consortium of international companies developing the Karachaganak -oil -and -gas condensate?field?would be expected by year's end.

Akkenzhenov told reporters in Astana that there are arbitration proceedings relating to the Karachaganak Project. We are expecting a decision to be made this month and by the end of this year.

In 2023, the Central Asian nation filed a claim against the developers of its Kashagan oilfields and Karachaganak, for disputed costs totaling $13 billion, and $3.5 billion, respectively.

Kazakhstan has been in a dispute with international oil companies for many years over costs.

Akkenzhenov said the government was also gathering documents to?sue the Kashagan Consortium in a second, bigger lawsuit, whose value hasn't been revealed.

He said the court would consider this case in 2026 or 2027.

The Karachaganak Petroleum Operating Consortium, comprising Eni, Shell, Chevron, Lukoil, and KazMunayGaz, with a combined share of 29.25% each, is expected to make a decision this month.

Critics claim that the government simply wants to increase its share in major oil and gas projects, which amounts to "resource nationalism".

Kazakhstan's authorities rejected this criticism and said their aim was to reduce costs that were inflated by Western companies.

Kazakh authorities announced in August that they were pursuing a $4.4 billion penalty against Kashagan, for what Astana claimed were environmental violations on the field. (Reporting and writing by Tamara Vaal, Felix Light and Vladimir Soldatkin; editing by Tom Hogue and Louise Heavens).

(source: Reuters)