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Kazakhs cry foul over ENA's Caspian operation

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Kazakhs cry foul over ENA's Caspian operation

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More trouble in Asia for western oil companies with the news Kazakhstan’s stopped work on the new Kashagan oilfield for three months, citing environmental concerns. The field has proved a problematic start-up plagued with delays, and the government says it may even revoke the operating permit held by Italy’s ENI to exploit the Caspian sea, the biggest oil find in decades.

The government has launched a criminal investigation into customs violations, and claims ENI has been corner-cutting fiscal and environmental regulations.

Kashagan was due to come on stream two years ago, but no oil will now flow until the end of 2010. Industry sources say some in the government are unhappy at what they feel were over-generous deals cut in the 1990’s with foreign companies, and are seeking to claw back some cash now foreign investment is less important. However Kazakhstan’s ecology minister insists several sensitive sites have not been protected.