Venezuela state oil company PDVSA is negotiating with ExxonMobil to pay what it owes of a $907 million arbitration ruling that favored the US company with crude instead of cash, a source in the PDVSA presidency said Thursday.
"This has to be paid as soon as possible," the source said.
ExxonMobil did not immediately respond to a request for comment.
The International Chamber of Commerce arbitration body on December 30 ruled that PDVSA owed ExxonMobil the money because of the state's 2007 seizure of its Cerro Negro oil project. Venezuela had renegotiated contracts with other oil producers as part of the wave of nationalizations, but was unable to come to an agreement with ExxonMobil.
PDVSA said in a statement January 2 that the actual additional payout it will have to make is only $255 million, however.
This takes into account some money PDVSA said ExxonMobil has acknowledged that it owes the state oil company, including that related to financing costs for the Cerro Negro project, and cash ExxonMobil successfully asked to have frozen in a PDVSA account in New York. PDVSA said it will also receive a "refund" of $160 million from the arbitration panel if it makes the payment within 60 days of the decision.
The PDVSA source added that ExxonMobil asked the US District Court for the Southern District of New York on January 26 to let it access the $315 million in frozen funds.
"That is part of the arbitration award," the source said.
ExxonMobil has also an arbitration pending in the International Centre for the Settlement of Investment Disputes, this time against the government of Venezuela instead of PDVSA, related to the Cerro Negro expropriation. The government of Venezuela recently notified the World Bank that it is pulling out of the ICC, although that decision will not affect pending claims such as ExxonMobil's or those filed within a six-month window.
Venezuela also faces other pending arbitration claims, including with ConocoPhillips.
