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Exxon 'loses' Venezuela nationalisation case
Chris Arsenault, Al Jazeera
Hugo Chavez must be smiling.
In the latest showdown between western oil companies and Venezuela’s populist president, Exxon Mobil is widely seen as the loser, after the Paris-based International Chamber of Commerce (ICC) ruled that the world’s biggest oil company would not be entitled to most of the damages it demanded after its fields were nationalised.
"The ICC only awarded Exxon ten per cent of what they wanted," Chavez said recently. "You can make your own conclusions."
Petroleos de Venezuela (PDVSA), the state oil company, said on January 2 it would pay Exxon Mobile $255m, after accounting for money frozen in a New York bank account and outstanding debts.
"Exxon has been granted the value of its [initial] investment, but not the value of the project today," Chris Nelder, an independent energy analyst, told Al Jazeera. The company had demanded as much as $12bn, citing potential lost future profits and other concerns, after the nationalisation of its Venezuelan heavy oil assets in the Orinoco belt in 2007.
"This is a victory against a corporation that tried to abuse Venezuelan law," said Eva Golinger, a lawyer and author of The Chavez Code: Cracking US Intervention in Venezuela. "The Venezuelan government had originally offered $1bn for the nationalisation and now they end up only having to pay $255m."
After four years of arbitration at the ICC, Exxon still has another case pending against Venezuela at the World Bank-affiliated International Centre for Settlement and Investment Disputes.
'Sending a signal'
"Traditionally, Exxon is very litigious," Steve LeVine, professor of energy security at Georgetown University, told Al Jazeera. "This whole exercise is about Exxon sending a signal around the world to anyone who would attempt to mess with their contracts."
After refusing to obey Venezuela’s new petroleum laws in 2007, under which foreign companies would have to become minority partners with PDVSA, Exxon and ConocoPhillips, another US firm, pulled out of the country entirely.
Exxon spokesman Patrick McGinn told the Associated Press that the arbitration award "represents recovery on a limited, contractual liability of PDVSA".
(6 January 2012)
Western Oil Firms Remain as US Exits Iraq
Dahr Jamail, Al-Jazeera-English
The end of the US military occupation does not mean Iraqis have full control of their oil.
BAGHDAD, Iraq - On November 27, 38 months after Royal Dutch Shell announced its pursuit of a massive gas deal in southern Iraq, the oil giant had its contract signed for a $17bn flared gas deal.
Three days later, the US-based energy firm Emerson submitted a bid for a contract to operate at Iraq's giant Zubair oil field, which reportedly holds some eight million barrels of oil.
Earlier this year, Emerson was awarded a contract to provide crude oil metering systems and other technology for a new oil terminal in Basra, currently under construction in the Persian Gulf, and the company is installing control systems in the power stations in Hilla and Kerbala.
Iraq's supergiant Rumaila oil field is already being developed by BP, and the other supergiant reserve, Majnoon oil field, is being developed by Royal Dutch Shell. Both fields are in southern Iraq.
According to the US Energy Information Administration (EIA), Iraq's oil reserves of 112 billion barrels ranks second in the world, only behind Saudi Arabia. The EIA also estimates that up to 90 per cent of the country remains unexplored, due to decades of US-led wars and economic sanctions.
"Prior to the 2003 invasion and occupation of Iraq, US and other western oil companies were all but completely shut out of Iraq's oil market," oil industry analyst Antonia Juhasz told Al Jazeera. "But thanks to the invasion and occupation, the companies are now back inside Iraq and producing oil there for the first time since being forced out of the country in 1973."
(7 January 2012)
The US-Iran Economic War
Pepe Escobar, Asia Times
Here's a crash course on how to further wreck the global economy.
A key amendment to the National Defense Authorization Act signed by United States President Barack Obama on the last day of 2011 - when no one was paying attention - imposes sanctions on any countries or companies that buy Iranian oil and pay for it through Iran's central bank. Starting this summer, anybody who does it is prevented from doing business with the US.
This amendment - for all practical purposes a declaration of economic war - was brought to you by the American Israel Public Affairs Committee (AIPAC), on direct orders of the Israeli Torrents of spin have tried to rationalize it as the Obama administration's plan B as opposed to letting the Israeli dogs of war conduct an unilateral attack on Iran over its supposed nuclear weapons program.
Yet the original Israeli strategy was in fact even more hysterical - as in effectively preventing any country or company from paying for imported Iranian oil, with the possible exceptions of China and India. On top of it, American Israel-firsters were trying to convince anyone this would not result in relentless oil price hikes.
(7 January 2012)
Japan to Express Concerns to U.S. Over Possible Iranian Oil Ban
Takashi Hirokawa and Yuji Okada, Bloomberg via Business Week
Japan plans to express its concerns about a possible embargo on Iranian crude oil to Treasury Secretary Timothy Geithner when he visits Tokyo next week, Chief Cabinet Secretary Osamu Fujimura said.
Foreign Minister Koichi Gemba “expressed our concerns to the U.S. government in December, including our worries about the impact of a possible import ban on the Japanese and global economy,” Fujimura told reporters in Tokyo today. “We are maintaining that position.”
Japan, which imports almost all of its energy supplies, is the world’s second-biggest buyer of Iranian crude after China.
(6 January 2012)
Related from Iran Press TV: Japan mulls ignoring US oil ban on Iran.