Kazakhstan has alleged in a confidential arbitration case that some of the biggest international oil firms that have developed the giant Kashagan oilfield awarded $10.7 billion worth of contracts with unjustified cost increases or through bribes. The Kashagan oilfield was developed by the North Caspian Project consortium of international majors and Kazakhstan's state oil firm KazMunayGas.
The Kazakh government alleges in the confidential arbitration that the Kashagan consortium awarded in the 2000s about a dozen contracts that contained unjustifiably high costs, or were compromised by bribery and self-dealing.
This claim is the gravest accusation at Big Oil yet in the years-long court dispute between Kazakhstan and the consortium over cost overruns, project delays, and environmental damage at Kashagan.
The allegation of compromised contracts is part of a larger, $160-billion claim from Kazakhstan against Big Oil over lost production and profits and environmental damages.
