Refineria de Cartagena (Reficar), a refinery owned by Colombia's largest company Ecopetrol, is set to receive more than $1 billion following an arbitration ruling in its favor against a group of contractors.
The International Chamber of Commerce ordered contractor CB&I to pay more than $1 billion to Reficar, plus interest gains from Dec. 31, 2015, Ecopetrol, a majority state-owned oil company, said.
Reficar sought arbitration in March 2016 amid a dispute with consortium CB&I, made up of Contractor Chicago Bridge and Iron Company NV, CB&I (U.K.)and CBI Colombiana SA.
The unit accused the consortium of doubling construction costs during the renovation of the refinery and failings in the engineering, procurement and construction (EPC) contract.
"The unanimous decision of the arbitration tribunal confirmed contractor CB&I was responsible for breaching its obligations under the EPC contract," Ecopetrol said in a statement published late on June 7.
Furthermore, CB&I's claims for $400 million were dismissed, Ecopetrol added, and the consortium was ordered to settle the EPC contract, as requested by Reficar.
The decision by the tribunal may be subject to formal corrections and clarifications, the statement added.
Reficar began operating at the end of 2015 following two years of delays and an investment of over $8 billion, double the expected figure.
The refinery, in northern Colombia, can process up to 200,000 bbl/d and is second only to the refinery in Barrancabermeja, which can process up to 250,000 bbl/d.
Ecopetrol generates most of the country's oil production. It owns the two main refineries as well as most of the pipeline network.
Recommended Reading
Mexico to Extend $6.7B to Cover Oil Producer Pemex's Debt in 2025
2024-11-15 - The Mexican government expects to transfer 136 billion pesos (US$6.69 billion) to state oil producer Pemex next year to help the heavily indebted firm meet its debt and loan repayments.
New US Solar Tariffs on Southeast Asia to Raise Prices, Cut Profit Margins
2024-12-02 - A new round of U.S. solar panel import tariffs on Southeast Asian producers is expected to raise consumer prices and cut into producer profit margins.
BLM Sets Aside Land for Solar Project Review in Utah
2024-12-02 - The project proposed for development by Hanwha Energy Corp.’s 174 Power Global could generate an estimated 600 megawatts of solar electricity.
US Supreme Court Should Avoid Climate Change Cases, Biden Administration Says
2024-12-11 - The Biden administration is urging the U.S. Supreme Court to reject efforts by oil companies to prevent lawsuits accusing the fossil fuel producers of deceiving the public about climate change.
Harris or Trump? Majors’ CEOs Say ‘Nothing's Going to Change’
2024-11-05 - The captains of BP, Shell, Petronas and Eni see the U.S. election as a short-term event, although the results could raise tensions with China and put the fate of the Inflation Reduction Act up in the air.
Comments
Add new comment
This conversation is moderated according to Hart Energy community rules. Please read the rules before joining the discussion. If you’re experiencing any technical problems, please contact our customer care team.