Kashagan operator confirms existence of environmental dispute with Kazakhstan, resolution possible via arbitration

MOSCOW. Oct 19 (Interfax) - The North Caspian Operating Company (NCOC) consortium, the operator of the Kashagan oil and gas field, has confirmed the existence of issues regarding environmental legislation, whose resolution is possible through arbitration, the NCOC told Interfax.

"The Kazakhstan Republic and contracting companies under a production sharing agreement for the North Caspian Sea, except for a subsidiary of the KMG Kashagan B.V. national oil company. They have a number of controversial issues regarding implementing certain provisions of the agreement that are subject to arbitration according to the agreement," the NCOC responded on whether the information is true that the consortium intends to pursue international arbitration to challenge the environmental fine that the country intends to impose on the NCOC.

"The contracting companies believe that they have acted in accordance with the production sharing agreement for the North Caspian Sea; the legislation of Kazakhstan; and the applicable standards and best practices," the consortium said.