US court backs ExxonMobil in spat with Venezuela's oil firm

US court backs ExxonMobil in spat with Venezuela's oil firm
AFP
AFP - 1 hour 30 minutes ago

NEW YORK (AFP) - A New York federal judge on Wednesday affirmed a freeze of 300 million dollars of assets owned by Venezuela's state oil company following a legal challenge by US oil major ExxonMobil.

Venezuela is fighting to overturn the US asset freeze, and other legal actions pursued by ExxonMobil in Britain, the Netherlands and the Netherlands Antilles.

"All the conditions have been met to confirm the attachment," said judge Deborah Batts, who presided over a review of the affair at a New York federal court.

The escalating legal battle relates to ExxonMobil's bid to secure compensation after Venezuela's leftist government nationalized key oil fields in the Orinoco basin, including two ExxonMobil operations.

Batts issued her judgment after the US State Department endorsed the Texas-based oil firm's attempt to secure sizeable compensation.

"We fully support the efforts of ExxonMobil to get a just and fair compensation package for their assets according to the standards of international law," State Department spokesman Sean McCormack told reporters earlier Wednesday.

Venezuelan Foreign Minister Nicolas Maduro took McCormack's statement as proof that the squabble was political in nature.

"The US government is nothing more than the direct representative of the multinational oligarchy ... who operates through political power, in this case the State Department," Maduro said in Caracas.

The latest installment in the legal battle came a day after Venezuela's state petroleum company, Petroleos de Venezuela (PDVSA), said it had suspended oil supplies to ExxonMobil.

PDVSA cited ExxonMobil's "judicial-economic aggression" in halting the oil transfers.

ExxonMobil was also criticized at the weekend by Venezuelan President Hugo Chavez, a frequent critic of the administration of US President George W. Bush.

Chavez lambasted the "bandits" and "white-collar criminals" at ExxonMobil and said the clash with the oil giant was "the tip of an iceberg that is economic war."

The South American nation is a significant supplier of oil to the energy-hungry United States and is a member of the Organization of the Petroleum Exporting Countries.

ExxonMobil says it has won court orders in New York, London, the Netherlands and the Netherlands Antilles freezing some 12 billion dollars of PDVSA assets in those jurisdictions.

The company on Wednesday declined to comment about the ongoing legal standoff.