CARACAS, Venezuela -- Venezuela said Monday it has successfully defended itself in an international arbitration case brought by Exxon Mobil Corp. and will need to pay only $255 million of the more than $900 million awarded to the company.
State oil company Petroleos de Venezuela SA, or PDVSA, said in a statement that debts and court action reduce what it owes under decision by the International Chamber of Commerce, which awarded Exxon Mobil more than $907 million in compensation.
It noted that Exxon Mobil had previously used international courts to freeze about $300 million in Venezuela's U.S. accounts and that the company also has a debt of $191 million relating to financing of an oil project in the country, as well as $160 million that the arbitration tribunal said was due to PDVSA.
PDVSA called it a "successful defense" and said Exxon Mobil had initially demanded about $12 billion in compensation while pursuing two international arbitration claims.
Exxon Mobil sought arbitration after President Hugo Chavez's government nationalized an oil project in the country in 2007.
The Irving, Texas-based oil company has not publicly commented on how much compensation it sought.
Exxon Mobil did not take issue with the figure that Venezuela said it would pay.
It said the tribunal had credited $160.6 million in debt against the award.
"The remaining $746.9 million could be paid through a combination of approximately $305 million in PDVSA funds already held for this purpose by New York courts, PDVSA's cancellation of additional project debt owed by Exxon Mobil and payment of additional cash," company spokesman Patrick McGinn said in an email.
Rafael Quiroz, an oil industry expert and professor at the Central University of Venezuela, said PDVSA was successful in emerging with a significantly smaller bill than Exxon Mobil had demanded.
"What it shows is that Exxon didn't have well defined, well laid out all of what it was claiming," Quiroz said.
PDVSA said that Exxon Mobil's compensation demands had been "completely exaggerated."
"After four years of arbitration, the real amount determined by the ICC tribunal indeed represents less than the exorbitant sum initially demanded," PDVSA said in the statement.
Exxon Mobil still has another arbitration case pending against Venezuela before the World Bank-affiliated International Centre for Settlement of Investment Disputes, or ICSID.
McGinn said the latest arbitration award "represents recovery on a limited, contractual liability of PDVSA." He said the larger ICSID arbitration against the government of Venezuela is ongoing and is expected to be argued in February."
More than a dozen other arbitration cases involving Venezuela are also pending as companies have sought billions of dollars in compensation in response to nationalizations by Chavez's leftist government.
The ICSID's website lists 17 pending cases against Venezuela. They include claims by Houston-based oil company ConocoPhillips Co., U.S. glass container manufacturer Owens-Illinois Inc. and Toronto-based mining company Crystallex International Corp.
Venezuela has reached negotiated agreements after taking over the operations of other companies such as Swiss cement maker Holcim and Mexican cement company Cemex SAB.