The British entity ConocoPhillips Gulf of Paria granted a loan to Corporación Venezolana del Petróleo (CVP) for the acquisition of a 35% stake in Corocoro, a credit guaranteed by PDVSA
A Spanish court has recognized the international arbitration award that condemns Petróleos de Venezuela (Pdvsa) and its subsidiary CVP to pay 33.7 million dollars plus interest as repayment of a loan to acquire part of the Corocoro oil field, which was nationalized after the granting of the credit.
The decision has been made by the Superior Court of Justice of Madrid (TSJM), as reported this Tuesday by the General Council of the Judiciary (CGPJ), which recalls that the parties involved agreed since the mid-nineties to submit any agreement to the International Court of Arbitration (ICC).
The British entity ConocoPhillips Gulf of Paria granted a loan to Corporación Venezolana del Petróleo (CVP) for the acquisition of a 35% stake in Corocoro, a credit guaranteed by PDVSA.
The project developed normally until, in 2007, the Venezuelan Government approved a nationalization decree that affected several foreign investments in the energy sector, including the Corocoro project.
ConocoPhillips initially filed a lawsuit for international arbitration and claimed more than $1.4 billion in New York Court for damages that included breaches of contract, tort, unjust enrichment and other claims.
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That court concluded that, although the 2007 nationalization made it impossible to continue the project under the initially agreed terms, this did not exonerate the defendant companies from complying with certain prior contractual obligations, such as the return of the loan granted to finance the participation in the deposit.
In this way, PDVSA and its subsidiary had to return to ConocoPhillips the amount lent plus interest, understanding that the reimbursement obligation was not extinguished or justified by the subsequent Venezuelan state nationalization.
Due to the lack of compliance with this award, issued in 2019, ConocoPhillips filed a lawsuit in Madrid in July 2024 to obtain approval of the foreign arbitration award and make it effective in Spain.
The TSJM concludes that the North American arbitration resolution “meets all the requirements demanded” by the 1958 New York convention on the recognition and enforcement of foreign arbitration awards.
Furthermore, among other arguments, the matter is “arbitrable”, the procedural guarantees were “respected” and the recognition of the award “is not contrary to Spanish public order”, which is why ConocoPhillips’ claim is fully upheld. The resolution is final and does not allow appeal, indicates the CGPJ in a statement.
With information from the EFE agency
*Journalism in Venezuela is carried out in a hostile environment for the press with dozens of legal instruments in place to punish the word, especially the laws “against hate”, “against fascism” and “against the blockade.” This content was written taking into consideration the threats and limits that, consequently, have been imposed on the dissemination of information from within the country.
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