Kazakhstan has filed for arbitration in a Swiss court in its lawsuit against major international oil firms as the OPEC+ producer seeks billions of U.S. dollars of damages from Big Oil over contract delays, bribery, and cost overruns, sources familiar with the matter told Bloomberg.
The country, where international majors including ExxonMobil, Chevron, Shell, Eni, and TotalEnergies, have developed massive oilfields, has two separate arbitration cases with as much as $166 billion in claims against the majors for damages, mostly because of lost revenues from delays at the Kashagan oilfield.
Kashagan is being developed by the North Caspian Project consortium of international majors and Kazakhstan’s state oil firm KazMunayGas. The shareholders in the consortium include KazMunayGas with 16.88%, Eni, Shell, ExxonMobil, and TotalEnergies with 16.81% each, China’s CNPC has an 8.33% stake, and Japan’s INPEX Ltd holds the remaining 7.56%.
Kazakhstan is also seeking $15 million plus interest from Eni and other companies it alleges were involved in bribery in oilfield development contracts. The country hopes the Swiss case will use evidence from depositions and proceedings in Houston and at Italian courts to demonstrate to the judges that bribery had taken place.
Back in 2016, Italian prosecutors dropped a case against Eni for alleged corruption involving the oil major’s business activities in Kazakhstan.
Contacted by Bloomberg, Eni stated in response to questions, “We understand that these allegations were contained in the US document request application filed by PSA LLC, which was subsequently dismissed by the Houston Court, save for the provision of certain generic Eni compliance procedures.”
“These allegations are based upon the very same schemes for which Eni was fully exonerated by the Italian authorities following their investigation more than a decade ago. We therefore believe that there is no basis for these allegations against any Eni company.”
Earlier this year, a Kazakh appellate court sided with the international oil majors operating the Kashagan oilfield, overturning a $4.4 billion fine for sulfur pollution over sulfur storage practices.
By Tsvetana Paraskova for Oilprice.com
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