By San Francisco Business Times

Police in Kazakhstan are investigating a oil company joint venture there thatâ¿¿s half-owned by Chevron Corp.

Financial police in the Central Asian nation called the probe a ⿿criminal⿝ investigation.

Authorities in Kazakhstan say the joint venture Tengizchevroil LLP, which is also a quarter-owned by Exxon Mobil (NYSE: XOM), has exported more oil than itâ¿¿s allowed to by its contract with the country.

A Kazakh government oil business, KazMunaiGas, owns 20 percent of the joint venture and Russian firm LukArco also holds a small slice.

Tengizchevroil has been working since 1993 in the Tengiz oil field, located on the northeast shore of the Caspian Sea. The field was found in 1979.

Two years ago Chevron invested new technology in the joint venture to boost its production to about 540,000 barrels per day.

Kazakhstan is a former republic of the Soviet Union. Though it borders the Caspian Sea, it is the largest landlocked nation in the world, since that sea does not connect with the ocean.

Some political and industry observers see this investigation as a possible move to put pressure on Chevron (NYSE: CVX) to give Kazakhstan a bigger slice of the pie. Chevron has faced similar pressures in Nigeria, for example, where the government has ⿿reinterpreted⿝ contracts and demanded bigger cuts of oil profits for access to its fields.

News reports Thursday also said Chevron agreed to sell its stake in an offshore block between Nigeria and island nation São Tomé and Principe to French oil giant Total.

Copyright 2010 American City Business Journals
Copyright 2010