Cash-strapped Venezuela on Aug. 17 filed an application for an annulment with the World Bank’s International Center for the Settlement of Investment Disputes (ICSID) pertaining to over $400 million earlier awarded to two Koch-owned companies.
Koch Minerals Sarl and Koch Nitrogen International Sarl filed to enforce the award in U.S. District Court in late 2017 (GM Dec. 1, 2017). The award pertained to Venezuela’s 2010 nationalization of FertiNitro (GM Oct. 18, 2010). The Koch companies filed a complaint with ICSID in 2011 (GM Aug. 1, 2011)
Koch Minerals Sarl had a minority stake of at least 25 percent in FertiNitro, and Koch Nitrogen International had an ammonia and urea offtake agreement. Venezuela failed to compensate either business for the expropriation of their interests at the time.
FertiNitro, located in the Jose Petrochemical Complex in Venezuela, ranked as one of the world’s largest nitrogen-based fertilizer plants, with nameplate daily production capacity of 3,600 mt of ammonia and 4,400 mt of urea. Other owners included Venezuela’s state-owned Pequiven, Snamprogetti SpA, and Cerveceria Polar CA.
The arbitration tribunal awarded Koch Minerals more than $168 million and Koch Nitrogen nearly $222 million, according to a Bloomberg report. The panel also awarded companies more than $17 million in legal costs and nearly $629,000 to cover arbitration costs.