Ecuador paid Occidental Petroleum Corp. $100 million Friday to partially settle a tax dispute, a spokesman for the country said.
Victor Carvajal, a spokesman for Ecuador’s Finance Ministry, told Bloomberg News that Ecuador paid the Los Angeles-based oil company after it stripped it of its oil concession in 2006 over an alleged contract breach.
Occidental and Ecuador disagreed over the amount of value-added taxes the company paid while doing business in Ecuador. A London court ordered the South American country to refund the $100 million, Carvajal said today in a telephone interview.
“We’ve reached an equitable settlement fair to Occidental and Ecuador,” Occidental spokesman Richard Kline told Bloomberg. Ecuador’s government also put $30 million aside pending further arbitration.
This case is unrelated to another dispute regarding Ecuador’s seizure of an Oxy oil field in Ecuador’s Amazon region in May 2006. The field is now operated by Ecuador’s state-owned oil company PetroEcuador and produces about 95,000 barrels a day.
Shares in Occidental closed down 1.9 percent to $77.15 in trading Friday.