Reuters had the scoop yesterday:
Venezuela’s state-run oil company PDVSA is using the sale of its Citgo Petroleum Corp refining assets to hinder the ability of ConocoPhillips to collect an expected arbitration award, the U.S. oil company said in a Texas court filing.
Evidence indicates PDVSA is liquidating its Citgo interests “to remove the proceeds from the United States to Venezuela or elsewhere with the specific intent to hinder, delay or defraud its creditors,” Conoco said on Monday in a petition for court approval to investigate that claim.
But as is typical, the big wire service couldn’t be dicked to post the filing. So here you go, yours at no extra fee. The “donate” button is over there on the right if you want to support independent journalism that actually gives you original documents, rather than making you scrounge around for them.
Sometime soon, the World Bank-linked ICSID tribunal will announce its awards in the arbitration cases brought by ExxonMobil (XOM) and ConocoPhillips (COP) against Venezuela for 2007 expropriations. What’s six years between friends?
Juan Carlos Boué writes an 84-page (plus notes) publicly available article in English explaining these huge arbitration cases, and why the outcome may not be as favourable (with a u) to XOM and COP as is widely assumed in the USA.
[The XOM and COP decision to leave Venezuela] has been presented as the calamitous culmination of a process whereby, through a mixture of bullying and unilateral measures, the Chávez administration sought to impose extortionate new terms on oil exploration and production activities in Venezuela, which rode roughshod over the vested rights of investors. Chávez’s actions, so this story goes, not only led to suspension of the transfer of managerial know-how and technology from which Venezuela had benefited so handsomely throughout the 1993-2006 period (and without which the gigantic resources of the Orinoco Oil Belt would not have been developed) but, ultimately, paved the way for the involuntary exodus of foreign oil companies from the country and the expropriation without compensation of their assets. That being the case, so this version goes, the aggrieved companies involved were left with no alternative but to initiate legal proceedings against a rogue government and its state oil
company and affiliates.
The picture presented in the paragraph above is drawn in strokes so broad and crude that it reduces the conduct and outcomes of Venezuelan oil policy from 1999 onwards to the level of a mere caricature. Nevertheless, the broadcast and print media have had no qualms about echoing and amplifying it, while a number of OECD governments – most especially, that of the USA – have seemed equally at ease to use it as a premise for taking foreign policy decisions with regard to Venezuela. That such credence should be vouchsafed to unproven allegations raised in the context of acrimonious litigation is hardly unprecedented in the annals of US foreign relations. Unfortunately, as on many a previous occasion, this facile stance contributes nothing towards understanding the real issues underlying, and arising from, a state’s exercise of its sovereign powers to the apparent detriment of the rights (real or alleged) of foreign investors.
If you’re an international law junkie, and I know many of you are, you can read the whole thing here.