(SRI) - Kazakhstan's financial police accused the Karachaganak Petroleum Operating (KPO) consortium last Friday of illegally earning $708 million in 2008, claiming it profited from oil output that was not approved by the state.
KPO reportedly produced 1.1 million tonnes of crude and 94,000 tonnes of gas condensate in excess of the agreed amount in 2008. The consortium operates the Karachaganak gas condensate field under a production sharing agreement (PSA) that regulates annual production levels. In total, the field produced approximately 18.6 million tons of crude equivalent in 2008.
KPO declined to comment on specifics of the allegations but denied any wrongdoings.
"KPO has acted in accordance with Kazakh law and the terms of the Final Production Sharing Agreement relating to the Karachaganak field. KPO will study the detail of any allegations presented to it, and if necessary, present a robust defense of its position," the venture's spokesman Francesca Ciardiello said in a statement.
This is the latest in a series of controversies surrounding Kazakhstan's second largest producing field.
In February, a local court [1] slapped KPO with a $21-million fine for environmental violations including excessive waste dumping dating back to 2008. In March, authorities said they would [2] audit the venture for possible violations of labor and migrations laws. KPO may also face a [3] tax claim of $136 million, according to news reports.
Government officials also claimed earlier this year that Kazakhstan may challenge the production-sharing agreements with Western oil companies as the government seeks to strengthen its grip of the energy sector. Karachaganak is the only major project in Kazakhstan which is currently being developed without the participation of the state company KazMunaiGas.
