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NEW YORK -(Dow Jones)- A federal judge upheld Wednesday an order freezing more than $300 million held by Venezuela's state oil company, a boost to Exxon Mobil Corp. (XOM) as it pursues compensation for a nationalized oil project.
At a hearing, U.S. District Judge Deborah Batts in Manhattan granted Exxon's motion to confirm an order of attachment for more $300 million held in a bank account by a unit of Petroleos de Venezuela (PVZ.YY), or PdVSA, in the U.S.
The funds will be frozen while Exxon and PdVSA conduct arbitration proceedings.
"It's not for payment," Batts said. "It's to make sure there's something to pay at the end of arbitration."
The ruling is the latest salvo in an increasingly bitter dispute between Exxon and Venezuela over changes in control and ownership of ventures producing abundant yet low-quality crude in Venezuela's Orinoco River Basin. While other Western energy giants agreed to new, less favorable, contract terms put forward by Venezuelan President Hugo Chavez last year, Exxon walked away from its venture and is currently wrangling with PdVSA over how much compensation it should receive.
Wednesday's ruling sets the stage for another hearing scheduled for Feb. 22 in the U.K. That hearing involves an order freezing up to $12 billion of PdVSA's assets, which include the extensive Citgo Petroleum Corp. refining network in the U.S.
http://money.cnn.com/news/newsfeeds/articles/djf500/200802131843DOWJONESDJONLINE001111_FORTUNE5.htm
At a hearing, U.S. District Judge Deborah Batts in Manhattan granted Exxon's motion to confirm an order of attachment for more $300 million held in a bank account by a unit of Petroleos de Venezuela (PVZ.YY), or PdVSA, in the U.S.
The funds will be frozen while Exxon and PdVSA conduct arbitration proceedings.
"It's not for payment," Batts said. "It's to make sure there's something to pay at the end of arbitration."
The ruling is the latest salvo in an increasingly bitter dispute between Exxon and Venezuela over changes in control and ownership of ventures producing abundant yet low-quality crude in Venezuela's Orinoco River Basin. While other Western energy giants agreed to new, less favorable, contract terms put forward by Venezuelan President Hugo Chavez last year, Exxon walked away from its venture and is currently wrangling with PdVSA over how much compensation it should receive.
Wednesday's ruling sets the stage for another hearing scheduled for Feb. 22 in the U.K. That hearing involves an order freezing up to $12 billion of PdVSA's assets, which include the extensive Citgo Petroleum Corp. refining network in the U.S.
http://money.cnn.com/news/newsfeeds/articles/djf500/200802131843DOWJONESDJONLINE001111_FORTUNE5.htm
