International Tribunal Rules That Ecuador's Taking of ConocoPhillips' Investment in August 2009 Cons
Dec 21st 2012 8:49PM
Updated Dec 21st 2012 8:50PM
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--(BUSINESS WIRE)-- 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.
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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.
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Daren Beaudo (media), 281-293-2073
Vladimir R. dela Cruz (investors), 212-207-1996
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KEYWORDS: United States North America South America Ecuador Texas
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