Conoco: It Could Take Years for Settlement with Venezuela
ConocoPhillips anticipates it could take years to obtain any negotiated or arbitrated settlement in the dispute the company has with Venezuela for the assets that the Chavez government expropriated last year, the company said Friday in its annual report.
"The timing of any negotiated or arbitrated settlement is not known at this time, but we anticipate it could take years," according to the report.
The Houston-based company also said the company estimates the value of the assets it abandoned in Venezuela in June "substantially exceeds the historical" initial investment.
In the second quarter of 2007, ConocoPhillips took a charge of $4.5 billion to write off its huge assets in Venezuela. ConocoPhillips and Exxon Mobil Corp. (XOM) filed a request for international arbitration with the International Centre for Settlement of Investment Disputes, an arm of the World Bank, last year.
Both companies left the country after the government of Hugo Chavez changed the terms of contracts of international oil companies giving a majority ownership to Venezuela's national oil company, Petroleos de Venezuela, or PdVSA.
Aside from the arbitration request, Exxon recently won a court-ordered freeze of $12 billion in international assets of PdVSA, to guarantee payment if it wins an international arbitration process against the government.
Copyright (c) 2008 Dow Jones & Company, Inc.
Operates 16 Offshore Rigs
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Company: ConocoPhillips more info
Operates 12 Offshore Rigs
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Company: PDVSA more info
Operates 14 Offshore Rigs
Manages 26 Offshore Rigs
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