Oil Firm May Have Case Against Venezuela
WASHINGTON (CN) - An American oil-drilling company claiming Venezuela and its late president Hugo Chavez seized its oil and gas rigs and stiffed it to the tune of $32 million may have a case, a federal judge ruled.
U.S. District Judge Robert Wilkins held that Tulsa, Okla.-based Helmerich & Payne International Drilling and its Venezuelan subsidiary have standing to pursue its expropriation claim against the Bolivarian Republic of Venezuela and its state-sponsored energy companies, Petroleos de Venezuela and PDVSA Petroleo.
H&P's 2011 complaint states: "On or about June 13 and 14, 2010, employees of the PDVSA defendants and armed and uniformed soldiers of the Venezuelan National Guard surrounded and unlawfully blockaded the business premises of H&P-V's drilling operations in Anaco, in the eastern region of Venezuela, at that time H&P-V's headquarters in Venezuela.
On information and belief, in effectuating both blockades," the plaintiffs continue, "the employees of the PDVSA defendants and the Venezuelan National Guard soldiers acted at the direction of defendant Venezuela and its anti-America and authoritarian President Hugo Chavez and/or his Minister of Energy and Petroleum Rafael Ramirez."
The complaint accuses Chavez's soldiers of seizing its assets, "preventing H&P-V from relocating any assets from its yards, and intimidating H&P into forgiving long-outstanding debts of the PDVSA defendants."
According to Helmerich, the seizure was a culmination of years of unpaid invoices and oil and gas contract breaches, bringing Venezuela's tab up to $32 million.
Though Judge Wilkins refused to grant standing to Helmerich to sue for breach of contract under the Foreign Sovereign Immunities Act, the judge allowed the company's expropriation claim to proceed on account of its Venezuelan national status.
"To summarize, the Court finds that H&P-V is a national of Venezuela under international law, H&P-IDC has standing to pursue the expropriation claim ... and the time is not yet ripe for a decision on whether the act of state doctrine bars plaintiffs' expropriation claims," the judge ruled.
Judge Wilkins also ordered a second phase of briefing on Venezuela's motion to dismiss. Chavez held the presidency of Venezuela from 1999 until his death in March, 2013.