2wolves: Has Exxon ever paid the Valdez fines? Ever?

It's been whittled down to a mumbled apology to a flock of Canadian geese via videophone.

I'm sure that Exxon will collect or come to some sort of business arrangment. If I remember correctly, Exxon successfully sued the US Government for bombing their facilities in nazi Germany after WWII.

Karma's a biatch, Exxon. Now fark off, I hope you don't actually get a dime.

They might collect it. According to other news reports, before going to court, Venezuela had offered to pay Exxon $1 billion but Exxon wanted $10 billion. The court ruled that Exxon should gt less than Venezuela had already offered to pay.

runwiz: They might collect it. According to other news reports, before going to court, Venezuela had offered to pay Exxon $1 billion but Exxon wanted $10 billion. The court ruled that Exxon should gt less than Venezuela had already offered to pay.

Bingo. This wasn't a win for Exxon Mobil - it was a win for Venezuela. Venezuela gets to pay even less than their offered settlement, Exxon Mobil is stuck with the binding decision, and Venezuela has now cut Exxon Mobil out of what appears to be one of the most lucrative petroleum markets in decades.

A billion dollars is what Venezuela will gross in, what, two months? Venezuela will happily pay Exxon Mobil the money, adding salt to the wound Exxon Mobil caused in the first place through their shady business practices.

No surprise, out comes the support for arbitrary asset seizure by authoritarian governments.

Chavez could get his own back by suing the US for what it has done to Venezuela. I doubt the US would like to pay that bill and will tell exxon to back off.

Sergeant Grumbles: 2wolves: Has Exxon ever paid the Valdez fines? Ever?

It's been whittled down to a mumbled apology to a flock of Canadian geese via videophone.

Last I heard Exxon was trying to get that prerecorded rather than live.

aearra: Chavez could get his own back by suing the US for what it has done to Venezuela. I doubt the US would like to pay that bill and will tell exxon to back off.

in what court?

Have the collectors' robo-call their home phone twenty times a day.


That will do it.


/oh yeah, say it will affect their credit...its really bad having below 700

Dougie AXP: aearra: Chavez could get his own back by suing the US for what it has done to Venezuela. I doubt the US would like to pay that bill and will tell exxon to back off.

This isn't snark: What have we done to Venezuela?

Dougie AXP: aearra: Chavez could get his own back by suing the US for what it has done to Venezuela. I doubt the US would like to pay that bill and will tell exxon to back off.

This isn't snark: What have we done to Venezuela?

We gave Chavez cancer.

fark Exxon. Sergeant Grumbles: 2wolves: Has Exxon ever paid the Valdez fines? Ever?

It's been whittled down to a mumbled apology to a flock of Canadian geese via videophone.

Pretty much. http://en.wikipedia.org/wiki/Exxon_Valdez_oil_spill#Litigation_and_cle anup_costs

The original judgement in 1994 was $5.3 billion. It's been in appeals ever since. In 2008, SCOTUS reduced punitive damages to $500 million and sent it back to lower courts, citing some maritime law. Basically, since Exxon didn't do it on purpose, they shouldn't have to pay so much in punitive damages. It's still in appeals.

FormlessOne: Bingo. This wasn't a win for Exxon Mobil - it was a win for Venezuela. Venezuela gets to pay even less than their offered settlement, Exxon Mobil is stuck with the binding decision, and Venezuela has now cut Exxon Mobil out of what appears to be one of the most lucrative petroleum markets in decades.


This is at best a short term win. PDVSA has seen a steady decrease in production as its leadership has been increasingly politicized filling the management ranks with Chavez loyalists (to maintain control of the company and as a reward for loyalty). In the meantime as production decreases and the price of oil remains static (if not decreasing) PDVSA is earning less revenue. Additionally, in order to increase production (it's possible to more than double their maximum output which is about a third higher than what they currently produce) would require significant investment and technical knowledge both of which PDVSA lacks. In fact, the kind of projects needed to increase extraction were the ones they nationalized and seized.

So, in the long term, Venezuela is screwed. They need outside capital and technical expertise to access the oil but the political instability in the nation and it's penchant for seizing the assets from their foreign partners once they are productive will discourage such assistance.

FormlessOne: This wasn't a win for Exxon Mobil - it was a win for Venezuela. Venezuela gets to pay even less than their offered settlement, Exxon Mobil is stuck with the binding decision, and Venezuela has now cut Exxon Mobil out of what appears to be one of the most lucrative petroleum markets in decades.

Thanks for laying it out so succinctly, FormlessOne, and allow me to join the chorus: "Hey Exxon, fark you!"

Sergeant Grumbles: 2wolves: Has Exxon ever paid the Valdez fines? Ever?

It's been whittled down to a mumbled apology to a flock of Canadian geese via videophone.

I read that thanks to clever accounting and tax shenanigans of the money they set aside for the penalty that they lawyered down over a period of decades, they actually managed to turn a profit on the whole thing.

Could you honestly see either side managing to collect from the other? I mean, the whole reason this is a dispute is that Venezuela went 'HA! HA! now we're going to TAKE ALL YOUR STUFF'. Chavez ain't paying up.

JK47: FormlessOne: Bingo. This wasn't a win for Exxon Mobil - it was a win for Venezuela. Venezuela gets to pay even less than their offered settlement, Exxon Mobil is stuck with the binding decision, and Venezuela has now cut Exxon Mobil out of what appears to be one of the most lucrative petroleum markets in decades.

This is at best a short term win. PDVSA has seen a steady decrease in production as its leadership has been increasingly politicized filling the management ranks with Chavez loyalists (to maintain control of the company and as a reward for loyalty). In the meantime as production decreases and the price of oil remains static (if not decreasing) PDVSA is earning less revenue. Additionally, in order to increase production (it's possible to more than double their maximum output which is about a third higher than what they currently produce) would require significant investment and technical knowledge both of which PDVSA lacks. In fact, the kind of projects needed to increase extraction were the ones they nationalized and seized.

While I agree that PdVSA's production has dropped quite a bit, I disagree with the characterization that Venezuela's essentially cut off its nose to spite its face - one of the reasons the Exxon Mobil and ConocoPhillips fields and assets were nationalized was because both companies refused, despite contractual obligations, to perform the upgrades & investments you describe. Venezuela fought for years to get the multinationals to understand that they had to work with the government, and steadfastly refused to negotiate. This wasn't sudden - it took years to build up, and when ConocoPhillips thought it was amusing to walk away from the table, to not even bother to show up to negotiations, well, action was required. Exxon Mobil, too, believed that its market clout would be enough to control the situation, and treated Venezuela's negotiations with outright contempt.

A short term win here was important to Venezuela's sovereignty. Even at their current production levels, PdVSA's domestic partners are pulling out more than enough to meet not just their obligations, but also the needs of Venezuela as a whole, and they're doing it on their own terms. Foreign companies are attempting to squeeze Venezuela's government through arbitration cases, and the Exxon Mobil case was a huge one - the fact that Venezuela only has to cough up about $900 million, instead of the $3.7 billion Barclays predicted, means quite a bit to the entire Latin American region. It's not just Venezuela that's nationalizing their resources - Argentina and Bolivia are watching all of this with interest, as well.

So, in the long term, Venezuela is screwed. They need outside capital and technical expertise to access the oil but the political instability in the nation and it's penchant for seizing the assets from their foreign partners once they are productive will discourage such assistance.

Actually, I disagree. PdVSA's increased dependence on domestic companies means a short-term decrease in production, but I expect it will gradually increase to something near pre-1999 levels in a decade or less. Venezuela's General Assembly codified nationalization requirements and standards in 2009, so foreign partners are actually more, not less, stable now because there's a very specific, and explicit, set of rules that they must now follow to obtain and satisfy contracts in Venezuela. Before 1999, PdVSA was little more than a rubber-stamping agency - now, they have the authority to protect Venezuela's interests. They just don't have the knowledge & experience to do so without first experiencing growing pains. They're not "cut off" from the rest of the world, either. Petrobras is spending billions in Latin American oil development investments. Belarus & China just put together Petrolera BeloVenesolana specifically to work some of the Lake Maracaibo fields. The real fear here is not "Venezuela won't produce oil", but that "Venezuela won't produce oil for us". It'll be interesting to see what this whole mess looks like in a decade.

As for political instability, well, this isn't 2002, and if we didn't keep screwing with Venezuela, I suspect political instability wouldn't even be an issue. The coup d'etat that was attempted in 2002 was a direct result of the Western world panicking at the idea of Venezuela booting out the rubber-stampers in PdVSA and replacing them with socialist Venezuelans. The 2002 coup d'etat largely failed despite our foreknowledge and (probable) involvement, and may have inadvertently reduced political instability in Venezuela because it gave hardliners a consistent political direction. That's why the following strike & recall referendum failed, cementing Chavez and firming up Venezuela's nationalism strategies.

Chavez can just pull out a big sack of Hugo Funbucks and pay whatever they ask. Then next week he'll make 1 Hugo NewFunbuck = 100,000 Hugo Funbucks and spend away.

Gosling: Could you honestly see either side managing to collect from the other? I mean, the whole reason this is a dispute is that Venezuela went 'HA! HA! now we're going to TAKE ALL YOUR STUFF'. Chavez ain't paying up.

At $900 million, Chavez will happily pay up - it's a sweet deal, actually less than what Chavez offered Exxon Mobil, and it legitimizes the nationalization of Exxon Mobil's assets. If Chavez didn't pay up, it would give Exxon Mobil and others a pretext for more legal action, and probably give the U.S. & other countries the necessary pretext for additional sanctions or even overt action.

Satanic_Hamster: Dougie AXP: aearra: Chavez could get his own back by suing the US for what it has done to Venezuela. I doubt the US would like to pay that bill and will tell exxon to back off.

This isn't snark: What have we done to Venezuela?

Dougie AXP: aearra: Chavez could get his own back by suing the US for what it has done to Venezuela. I doubt the US would like to pay that bill and will tell exxon to back off.

This isn't snark: What have we done to Venezuela?

We gave Chavez cancer.

Actually, the Bush Administration tried their rather heavy & clumsy hand at covert manipulation of the Venezuelan government.

We helped anti-PdVSA folks engineer a general strike in 2001, as a direct result of Chavez taking control of PdVSA and pushing strategic nationalization. It failed.
When that failed, we helped anti-Chavez folks engineer a coup d'etat in 2002. It failed.
The folks we helped in 2001 tried again, with another strike, in 2003. Although it had severe economic effects, it essentially failed.
The folks we helped in 2002 tried again, with a recall referendum, in 2004. It failed.

Thanks to the obvious "success" of the Bush Administration, Chavez was able to point at the U.S. as a foreign influence attempting to disrupt the sovereignty of Venezuela, cementing his reelection in 2006. I can't help but think that, perhaps, having someone at the helm other than that chucklehead Dubya might have blunted the political edge of Chavez and achieved more results over the long term.

Hugo should call Iran and buy the $2.000.000.000 that are frozen in the USA for $500.000.000. Then the USA get two billion, Iran get half a billion and Hugo gets a 50% discount.

Chavez will pay this over his dead body.

wombatsrus: Chavez will pay this over his dead body.

He will pay... Next year.

There's a presidential election this year, so he needs that money.


My uncle was one of the top PDVSA oil engineers of Western Venezuela (Zulia) and was in charge of producing almost one million b/day. He was fired when Chavez fired over 10k skilled workers out of PDVSA. (Yes, 10 thousand). Oil production dipped considerably and even though "official" sources claim its at 2.5mb/d. Its more around 1.7/8 and declining.

Where did all the talent go? Ask the neighbor, Colombia. Whos oil production has increased ten fold in the past few years thanks to Venezuelan oil skilled workers (and to some extent Canada's and USA).

I dont disagree with the whole
exxon and conoco pretty much not wanting to negotiate, I do have to say, few companies have the tech to extract the oil from the Orinoco tar sands, most of them american (Conoco, Exxon) I think its either Shell or BP the other one (non us). So, he expropiated the fields... And are now dead, nobody is working them for the lack of tech.

I'm not shedding any tears for Exxon, but I'm not going to defend the shiathole that PDVSA has become.

"international chamber of comerce" is that a pathetic front orginization for Mega Corps to leverage themselves against governments?
The so called "US chamber of comerce" is a front orginization for the 16 largest US corporations, they provide all of it's funding, and it lobbies for them.

an arbitrator who is paid for by Exxon, decides that Exxon deserves lots of money.

Wow.

JK47: FormlessOne: Bingo. This wasn't a win for Exxon Mobil - it was a win for Venezuela. Venezuela gets to pay even less than their offered settlement, Exxon Mobil is stuck with the binding decision, and Venezuela has now cut Exxon Mobil out of what appears to be one of the most lucrative petroleum markets in decades.


This is at best a short term win. PDVSA has seen a steady decrease in production as its leadership has been increasingly politicized filling the management ranks with Chavez loyalists (to maintain control of the company and as a reward for loyalty). In the meantime as production decreases and the price of oil remains static (if not decreasing) PDVSA is earning less revenue. Additionally, in order to increase production (it's possible to more than double their maximum output which is about a third higher than what they currently produce) would require significant investment and technical knowledge both of which PDVSA lacks. In fact, the kind of projects needed to increase extraction were the ones they nationalized and seized.

So, in the long term, Venezuela is screwed. They need outside capital and technical expertise to access the oil but the political instability in the nation and it's penchant for seizing the assets from their foreign partners once they are productive will discourage such assistance.

Basically this is right. But it should be noted that companies like Chevron (and others) stuck around in Venezuela, so will be in a good position to to pick up the pieces when things get real bad for PdVSA. Also, this one judgement doesn't end the saga between Exxon and Venezuela, they still have cases pending before ICSID.
Link (new window)

madgordy: "international chamber of comerce" is that a pathetic front orginization for Mega Corps to leverage themselves against governments?
The so called "US chamber of comerce" is a front orginization for the 16 largest US corporations, they provide all of it's funding, and it lobbies for them.

an arbitrator who is paid for by Exxon, decides that Exxon deserves lots of money.

Wow.

$908 million is not a lot of money, it's chump change. This was a win for PvSDA.