Arbitration court rejects Kazakhstan's $12 billion claim over Kashagan oil field

An international arbitration court has ruled invalid Kazakhstan's claims worth about $12 billion against major oil companies that are shareholders in the North Caspian Operating Company (NCOC), which develops the Kashagan field on the Caspian Sea shelf. The claims concerned disputed development costs, according to Bloomberg, citing sources familiar with the situation.

The court did, however, uphold other claims worth about $8 billion. The arbitration will continue, and the government will seek total compensation of more than $150 billion. According to the report, the court found the government filed its claim too late regarding costs incurred between 2011 and 2015. Kashagan, the country's second-largest oil field, came online several years late and well over budget; partners have invested about $55 billion.

The Kazakh Ministry of Energy and NCOC did not respond to requests for comment. ExxonMobil, Shell, TotalEnergies, KazMunayGas and Inpex declined to comment, while CNPC and Eni did not immediately respond. ExxonMobil has said that a potential $80 billion joint investment to expand Kashagan depends on resolving the dispute.