Kazakhstan ‘considering $2bn BG-Eni fine’

28 October 2015m News Wires – The government of Kazakhstan is considering imposing a $2 billion fine on a joint venture project led by UK gas major BG Group and Italy’s Eni for failing to fulfil “certain contractual obligations”, according to a report.

EniThe fine would be in line with penalties the government threatened to impose in a 2010 dispute that ended with the state taking a 10% stake in the Karachaganak gas and condensate project, Bloomberg reported.

Kazakhstan is reportedly seeking extra revenue to bolster its finances.

Eni and BG each own 29.25% of the project in north-west Kazakhstan, which they jointly operate, while state-owned KazMunaiGaz owns 10%, with US oil supermajor Chevron holding 18% and Russia’s Lukoil 13.5%.

The penalty may be a precursor to the government increasing its stake in Karachaganak, Bloomberg said.

BG, Eni, Lukoil and Chevron did not comment when approached by Bloomberg. KazMunaiGaz said questions should be addressed to the Energy Ministry, which also was not available for comment.


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