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Wednesday, 07 January, 2009, 19:50 GMT | more >>

ExxonMobil bid to settle tax row



By Upstream staff 

US supermajor ExxonMobil said it has not ruled out international arbitration in a tax dispute with Venezuela, although it said it would continue to work towards a friendly solution.

An ExxonMobil spokeswoman said: "Arbitration remains an option. However, (the company) wishes to explore an amicable resolution."

Venezuela boosted the royalty of ExxonMobil's Cerro Negro heavy crude upgrading project, along with three other similar projects in Venezuela's Orinoco tar belt, to 16.6% from 1% last October.

ExxonMobil said the low royalty rate compensated for heavy investments in the project's initial phases, and added it expects Venezuela to honour the original contract.

Venezuela's Oil Minister Rafael Ramirez has said the government will draft legislation to raise the income tax rate on the Orinoco projects to 50%, up from a preferential rate of 34%.

ExxonMobil's partners in Cerro Negro are BP and Venezuela's state-run outfit PDVSA.

Texas-based ExxonMobil is the only one of six major players operating in Orinoco to publicly challenge the tax hike.


Thursday, 23 June, 2005, 16:21 GMT  | last updated: Friday, 24 June, 2005, 07:43 GMT

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