International Tribunal Rules that Ecuador’s Taking of ConocoPhillips Investment in August 2009 Constituted Unlawful Expropriation in Violation of Ecuador’s International Law Obligations
HOUSTON, -- ConocoPhillips’ [NYSE:COP] wholly owned subsidiary, Burlington Resources Inc., has received a favorable decision in the international arbitration filed against Ecuador. The Tribunal, constituted under the International Centre for the Settlement of Investment Disputes (ICSID), ruled that Ecuador unlawfully expropriated the company ’s significant oil investments in Blocks 7 and 21, in violation of the U.S.-Ecuador bilateral investment treaty.
The Tribunal also found that Burlington’s investment, expropriated by Ecuador, included the contractual right to be indemnified for the effects of the Windfall Profits Tax (Law 42).
“This decision sends a message that contracts must be honored and governments cannot expropriate investments without compensation,” said Janet Kelly, senior vice president, Legal and General Counsel. “The ruling confirms that Ecuador’s actions were not in accordance with international law.”
While this ruling is an essential step in the process, the Tribunal has not yet issued a decision on damages. An additional arbitration phase will take place to determine the amount of compensation owed to Burlington for Ecuador’s actions.
# # #
Headquartered in Houston, Texas, ConocoPhillips had operations and activities in 30 countries, $115 billion of assets, and approximately 16,700 employees as of Sept. 30, 2012. Production averaged 1.57 million BOE per day for the nine months ended Sept. 30, 2012, and proved reserves were 8.4 billion BOE as of Dec. 31, 2011. For more information, go to www.conocophillips.com.
CAUTIONARY STATEMENT FOR THE PURPOSES OF THE “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This news content was configured by WebWire editorial staff. Linking is permitted.