ConocoPhillips has reportedly filed for arbitration against the Venezuela state oil company, Petroleos de Venezuela (“PDVSA”). According to ConocoPhillips’ request to the International Chamber of Commerce (“ICC”), PDVSA failed to pay the company the contractual compensation owed to it over the Petrozuata and Hamaca heavy crude oil projects. Although ConocoPhillips agreed to develop the areas under an investment treaty that was signed in the 1990s, Venezuela later seized and nationalized the investments without payment in mid-2007.
In addition to the ICC arbitral request, a separate investment treaty arbitration between ConocoPhillips and Venezuela is now pending before an International Centre for Settlement for Investment Disputes (“ICSID”) arbitral tribunal. Last month, the World Bank’s ICSID tribunal found that Venezuela illegally expropriated ConocoPhillips’ oil investments in the nation. Further proceedings to determine the amount of damages owed to the company are currently ongoing. Yesterday, the ICSID ordered Venezuela to pay oil company Exxon $1.6 billion in damages in a similar case.
Stay tuned to Disputing for more on this interesting issue!
Photo credit: ruurmo / Foter / CC BY-SA
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