An oil company with ties to the Chinese government can seek its share of a nearly $1 billion settlement Ecuador agreed to pay to a subsidiary of Occidental Petroleum Corp. after shutting down a project to explore for oil deep in the country’s rainforest, an international tribunal has ruled.
Andes Petroleum Ecuador Ltd. filed a petition in New York federal court Monday to enforce the approximately $392 million award against Occidental Exploration and Production Co., which it won in March after an International Centre for Dispute Resolution tribunal concluded that the the Texas-based company had breached a provision of a 2006 deal the companies inked after it became apparent that the project was likely to be terminated.
The pact obligated Occidental to pay Andes Petroleum 40% of any amount it received in the resulting dispute with Ecuador. Occidental subsequently initiated arbitration against the country, winning some $1.77 billion in 2012 that was later reduced to $1.06 billion. Ecuador settled the dispute in 2016, agreeing to pay nearly $980 million.
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