The Kashagan development was suspended for at least three months because of ``environmental violations,'' Environment Minister Nurlan Iskakov said on state television today. A criminal probe was also opened for alleged customs violations by an Eni unit operating the project, the Customs Service said.
Kazakh officials last week demanded Rome-based Eni, Europe's fourth-largest oil company, cede a bigger stake in Kashagan or risk losing operational control of the field. International oil companies including Eni are being forced to renegotiate exploration contracts with resource-rich countries that demand larger profits from surging oil prices.
Eni Chief Executive Officer Paolo Scaroni said last week that the company would send a delegation to Kazakhstan on Aug. 27 to open ``friendly'' negotiations that would last about two months. Scaroni said he would fly to Kazakhstan himself after Sept. 4, followed by Prime Minister Romano Prodi Oct. 7-8.
Eni and bigger rivals Exxon Mobil Corp., Total SA and Shell all hold 18.5 percent of Kashagan, while ConocoPhillips has 9.3 percent. Kazakhstan's national oil company, KazMunaiGaz, and Japan's Inpex Corp. each own 8.3 percent.
Eni declined to comment on the suspension, a Rome-based spokeswoman for the company said, declining to be identified, citing company policy.
Via: Bloombergby Nariman Gizitdinov
