* Government has already threatened to sue over delays
* Tactic has secured stakes in all foreign oil projects
* Contract breaches may mean non-reimbursement of costs
* Ministry says Kashagan consortium burnt off too much gas
By Raushan Nurshayeva
ASTANA, March 7 (Reuters) - Kazakhstan is suing foreign oilmajors developing its huge Kashagan oilfield in the Caspian Sea,a tactic similar to those that secured the government largestakes in two of the three multinational energy projects on itsterritory.
Repeated delays at the 13-year-old project, targeted toproduce as much oil as OPEC member Angola from a reserve almostas big as Brazil's, have infuriated the Kazakh government.
The consortium, led by Exxon, Royal Dutch Shell, Total and Eni as well as Kazakhstate oil firm KazMunaiGas, may face Kazakhstan seizinga bigger stake in Kashagan or refusing to reimburse a big chunkof the $50 billion spent on bringing it onstream.
The latter option is written into the Kashagan contracts.
"The delay is impacting effectively the GDP growth of thecountry," Fadi Farra, adviser to the Kazakh prime minister, tolda conference in London.
"We're not talking about small game; we are talking about animpact of two to three points on the GDP of the country.Therefore a failure in pipelines, a technical issue, isimpacting the economic development of the country," he added.
Production at Kashagan, the world's biggest oil discovery in35 years, began in September but was stopped just weeks laterafter gas was found to be leaking from its pipelines.
Residual sour gas was then burnt in flares at Kashagan'sprocessing plants, polluting the environment, the EnvironmentProtection Ministry said in a statement on Friday.
Checks showed that the volume of gas burnt in flares lastSeptember and October was 2.8 million cubic metres, exceedinglegal limits, the ministry said, and a claim for 134.2 billiontenge ($737 million) against the North Caspian Operating Company(NCOC) has been made by Atyrau Region authorities in westernKazakhstan where Kashagan is located.
NCOC, contacted by Reuters, declined immediate comment.
Kazakhstan, a vast steppe nation of 17 million people, isCentral Asia's largest economy and the second-largestformer-Soviet oil producer after Russia. It is home to slightlymore than 3 percent of the world's recoverable oil reserves.
GAS LEAKS
State firm KazMunaiGas took a shareholding in the Kashaganconsortium in 2005 and later doubled its stake to 16.81 percent,equal to those of the four foreign stakeholders.
Japan's Inpex has 7.56 percent, and China NationalPetroleum Corp (CNPC) bought 8.33 percent in 2013from ConocoPhillips.
KazMunaiGas also secured a 10 percent stake the giantKarachaganak oil and gas condensate field in northwesternKazakhstan in 2011. Other project participants are BG,Chevron and Russia's Lukoil.
Before the gas leaks brought Kashagan's output to a halt, the consortium had failed to achieve so-called "commercialoutput" at the field by Oct. 1 as stipulated in its contract.
This means that NCOC members will not be reimbursed forcosts between then and the date when they finally achievecommercial output, KazMunaiGas head Sauat Mynbayev said thisweek, reiterating a clause added to the production sharingagreement in 2008.
Kazakh Prime Minister Serik Akhmetov said last week he hopedthat the field could start producing again in the first half orearly in the second half of this year.
Kazakhstan's central bank governor, Kairat Kelimbetov, saidin February the government had no plans to nationalise Kashagan.
NCOC said last month that, as a precautionary measure tosave time, it had begun a tender process for the potentialpurchase of pipeline joints "for various scenarios".
Much of its infrastructure is built on artificial islands toavoid damage from pack ice in a shallow sea, which freezes fivemonths a year in temperatures that drop below minus 30 degreesCelsius (-22 F).
