Chevron Corp. (CVX) Friday said it will challenge in court a $290 million back tax claim slapped on a pipeline consortium it helps lead in Russia.
Russia's Federal Tax Service ordered the Caspian Pipeline Consortium at the end of June to pay 2.1 billion rubles in back taxes from 1999-2002 and 4.7 billion rubles for 2002-2003, the news agency Interfax reported Friday.
"This claim (in the amount of $290 million) will be disputed in the courts," Chevron said in a statement. The San Ramon, California-based company is the largest private shareholder in the pipeline group with a 15% stake and total investment of about $800 million, according to a description on the company's Web site.
The tax claim comes after Russian authorities the past year have forced some foreign oil companies, like Royal Dutch Shell PLC (RDSA), to cede control of energy projects and pay higher taxes.
A spokeswoman for the pipeline consortium told Dow Jones Newswires that no date has been set for a court hearing.ExxonMobil Corp. (XOM) is also a small stakeholder in the consortium.
Private shareholders in CPC, operators ofa 935-mile oil pipeline from the Tengiz field in Kazakhstan to Novorossisk on the Black Sea, have been at loggerheads with the Russian government for years over the division of revenue from the project.
The Russian government says the consortium is forced to borrow on non-market terms from its private shareholders and says the consortium is artificially depressing its profit level and making itself unable to pay dividends as a result.
OAO Transneft (TRNFP.RS), which now represents the Russian government's 24% stake in the consortium, wants the company to refinance its debt through the issuance of Eurobonds, pointing to the much more favorable rates that Transneft itself has been able to raise from the market in recent months.
CPC, which has total debt of around $5 billion, pumped 31.12 million metric tons of oil in 2006, the equivalent of over 600,000 barrels a day. The pipeline's capacity is supposed to be expanded to 67 million tons a year, or 1.38 million barrels a day, but the move needs approval from the Russian shareholders.
Your Ads At Here
