Kazakh Kashagan operator appeals fine for ecological damage
Baku, Azerbaijan, March 17
By Elena Kosolapova - Trend:
The operator of Kazakh Kashagan project, North Caspian Operating Company (NCOC) and Agip KCO agent do not agree with the 134.3 billion tenge ($737 million) fine imposed by Kazakh ecologists, Kazinform reported on March 17.
Atyrau region's Ecology Department checked if Kazakhstan's environmental legislation had been observed by NCOC consortium and Agip KCO in October 16, 2013 - February 7, 2014. Following this examination the ecology department ordered the companies to eliminate violations of environmental legislation.
"NCOC and Agip KCO disagree with the act and the verdict and submitted objections to the Ecology Department. Since the Ecology Department did not agree with the submitted objections, NCOC and Agip KCO appealed the act and decree in Specialized Inter-district Economic Court of the Atyrau region on February 24, 2014," NCOC said.
Oil production at Kashagan field was launched on September 11, 2013 and was suspended on September 24, following detection of gas leak in the onshore section of the gas pipeline running from D Island to the onshore processing facility Bolashak. Oil production was resumed on Oct. 6 as the affected joint was repaired and stopped again on Oct. 9 after another seep was detected. The direct cause of pipeline leaks was cracking under the influence of sulfide compounds, according to the preliminary results.
Kazakhstan's environment ministry announced it would impose a fine of 134.2 billion tenge on the NCOC consortium and Agip KCO, operating the project, because of damage to the environment caused by a gas leak.
Kashagan is one of the largest oil and gas fields of the world. The total oil reserves of the field amounts to 38 billion barrels, while some 10 billion out of them are recoverable reserves. Moreover, there are large natural gas reserves at the Kashagan field - over one trillion cubic meters.