Introduction

January 18th, 2012 - A short note looking into how the arbitral tribunal in the ICC arbitration Mobil Cerro Negro v. Petroleos de Venezuela S.A. et al. (ICC Case No. 15415/JRF) reached its conclusions regarding the sum to be awarded Mobil Cerro Negro as compensation for the Cerro Negro heavy oil project. It appears the amount awarded to the ExxonMobil subsidiary was calculated from a contractual indemnity clause with a cash flow formula for the project's oil in the joint venture's Association Agreement with PDVSA and related Accounting Principles Agreement.