Venezuela is sending to China all the oil it previously shipped to a US refinery jointly owned with Exxon Mobil amid a legal battle between the OPEC nation and the US oil giant, Energy Minister Rafael Ramirez said on Friday.
“With respect to the shipments, we put them at China’s disposal,” Ramirez told reporters. “All of it.” Exxon and Venezuela have been in dispute over supplies to the Louisiana-based Chalmette refinery since Exxon won court orders freezing $12 billion in Venezuelan assets as part of a legal battle over compensation for Exxon assets Venezuela nationalized in 2007.
State oil company PDVSA halted supplies to Chalmette, a 50-50 joint venture that can process about 193,000 barrels per day of crude, after Exxon began rejecting some of the cargoes that Venezuela destined for the refinery. Ramirez said PDVSA rerouted the supplies in protest, which he said were meant to pressure Venezuela as part of an international arbitration over the 2007 nationalization of the Cerro Negro heavy oil project that Exxon once ran.
Exxon wants at least $5 billion in compensation, though PDVSA says it is due less than $1 billion. A London court this month lifted one of the freeze orders, though Exxon still has similar injunctions in Netherlands and Netherlands Antilles courts. Venezuelan President Hugo Chavez is keen to export more oil to Asia to reduce traditional dependence on United States energy markets. (Reuters)