By Youri Kemp
Caribbean News Now associate editor
WILLEMSTAD, Curacao — On Sunday, a Curacao court ordered the seizure of $636 million in assets belonging to the Venezuela state-owned oil company, Petróleos de Venezuela, SA (PDVSA), thus awarding multinational oil giant ConocoPhillips a portion of its $2 billion settlement won in an arbitration ruling handed down by the International Chamber of Commerce last month.
Conoco’s assets in Venezuela were expropriated in 2007 following a nationalization of the country’s oil industry instigated by late President Hugo Chavez. This led to lengthy legal proceedings, ending in an April ruling by the ICC awarding Conoco over $2 billion in damages.
The assets ordered to be seized by the Curacao court, following the guidelines provided in the ICC arbitration ruling, are located at the Isla refinery in Curacao.
All of this is in the midst of already a turbulent time in Venezuela, as the nation’s political and economic crisis has turned into a humanitarian nightmare, as residents leave the country in droves.
This also creates added pressure on Venezuela oil exports, its major commodity, as earlier seizures of its tankers in Curacao waters on behalf of vendors owed by Venezuela have been frequently taking place as the struggling nation finds it difficult to pay its bills.
This ruling by the Curacao court sets a precedent with regard to the ICC, as a ruling by the ICC cannot be generally enforced, which means that rulings can only be enforced by any particular sovereign state where damages can be extracted as the case may be.
Curacao officials are planning to meet with PDVSA and Conoco this week to discuss the dispute and court order, and how both parties can proceed.
Sources have also stated that the Venezuelan government plans to shut down the Isla refinery as a result of the court ruling. However, no word on that shutdown has been confirmed; neither has a threat of Venezuela stopping tankers on the way to Curacao been confirmed.