QUITO: Ecuador will pay US oil company Burlington Resources $337 million in damages, the attorney general’s office announced Monday, ending a legal battle lasting almost a decade.
The settlement corresponds with the $380 million payment ordered at an International Centre for Settlement of Investment Disputes (ICSID) hearing in February, minus $42 million awarded to Ecuador for environmental damage.
A source from the attorney general’s office told AFP both parties agreed the payment will be made in two instalments—one of $75 million, already made on December 1, and another of $262 million which will be paid in April 2018.
Burlington Resources was working in two oil blocs in Ecuador alongside France’s Perenco in 2008, but halted operations after Ecuador demanded more compensation after the price of oil rose.
Both companies were accused by Ecuador in 2009 of abandoning their operations in the country, and in 2010 it declared the oil contracts with the Franco-US consortium null and void —prompting ConocoPhillips subsidiary Burlington Resources to sue Ecuador for $400 million in the ICSID, an autonomous part of the World Bank.
The US company demanded a figure of around $1.5 billion from Ecuador, which the ICSID reduced by 78 per cent.