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I say things on Twitter

1/2/12

Chart of the day is...

...one that compares the following
1) What Exxon-Mobil (XOM) wanted from the arbitration brought before the ICSID/CIADI international arbitrations court.

2) What Venezuela wanted to pay XOM

3) What ICSID/CIADI ruled yesterday

And yet XOM and the northern business press is spinning this decision as a win for XOM. Go read Setty today for lots more, with specific posts here and here, to find out the truth of the matter. As Setty rightly says, yesterday was a massive win for Venezuela, no split hairs, no bones, no subtleties, no comebacks. Not only that, but it sets legal precedent on the policy of paying book value on nationalizations that Venezuela has always used.

UPDATE: Reader 'JW' writes in to note that Venezuela was willing to pay $1Bn, not the $750m noted on the chart above. That's true JW, so to cut a long story short and get it at least in the ballpark Venezuela was willing to pay $1bn as an out of court settlement, XOM refused that number so Venezuela at court pitched for Book Value of XOM's part of the Cerro Negro project. The court in the end awarded less than Venezuela's out of court offer.

By the way, there's also a moving scale on the XOM demand, which may have been as low as $6.5Bn in the end, but started at $12Bn (according to Setty's post). So "ten times less than the demand" is where we're pitching that chart but whatevs dudes...XOM large fail on this.