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Costa Rica Formally Rescinds
Harken Energy Oil Contract
The
Costa Rican government
formally canceled the1998
concession for oil exploration
it had granted to Houston-based
Harken Energy Corporation (HEC),
after years of wrangling over
the deal.
"This marks the end of the
administrative process and the
definitive rescission of the
contract," said Environment
Minister Carlos Manuel
Rodriguez.
President Abel Pacheco said that
"what has happened here has
nothing to with us, rather it is
due to Harken's failure to
comply with several parts of the
contract."
"When they failed to comply, we
simply took this measure,"
Pacheco said.
In 2004, the government backed
away from previous plans to pay
Harken Energy a settlement as
part of the contract dispute.
Costa Rican officials say that
Harken was to blame for failing
to present an adequate
environmental impact study on
the oil project.
Rodriguez had once said the
government was considering a
payment of between US$3 million
and US$11 million because it was
cheaper than risking a trial in
U.S. courts.
In October 2003, Harken dropped
a US$57 billion claim before the
World Banks' International
Center for Settlement of
Investment Disputes, but said it
would still pursue compensation.
Harken Costa Rica Holdings won
concession rights in 1998 to
explore for oil off the coast of
Limon, 100 miles east of the
capital, San Jose. But the
Environment Ministry denied a
permit to explore there, saying
the plan wasn't "
environmentally viable."
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