Skip to main content

Posts

Showing posts from April, 2015

China’s Andes Said to Join Repsol in Ecuador Oil Drilling Freeze

By Nathan Gill and David Wethe  (Bloomberg) -- Andes Petroleum Ecuador Ltd. and Repsol SA, Ecuador’s two biggest foreign oil producers, are shelving plans to drill exploratory wells amid a payment dispute with the OPEC nation’s government, according to two people with direct knowledge of the matter. 
Andes, owned by China National Petroleum Corp. and China Petrochemical Corp., and Madrid-based Repsol have notified Halliburton Co. that they plan to freeze their drilling contracts this year, said the two people, who asked not to be named because the matter hasn’t been made public. Houston-based Halliburton provides services to both companies, which pump oil for Ecuador’s government for a per-barrel fee. 
A third person with knowledge of Repsol’s plans, who isn’t authorized to speak about the matter publicly, said the Spanish company has begun notifying all of its service providers in Ecuador, including Halliburton, that it wants to reach new agreements after global oil prices fell. Cur…

Ecuador Approves New Labor Law With Changes to Public Pensions

By Nathan Gill (Bloomberg) -- Ecuador’s congress approved changes to the Andean nation’s labor laws on Tuesday, including the removal of a government subsidy meant to cover almost half of state pensioners’ monthly payments.
Lawmakers approved the measure proposed by President Rafael Correa in a 91-to-29 vote, while government supporters and political opposition groups looked on from a packed balcony at congress in Quito. The new law replaces the subsidies with a general promise of future state funding for pensions, if needed.
Correa and members of his Alianza Pais political party have argued that the government didn’t need to subsidize the social security institute, known as IESS, because Ecuador has a surplus of young workers whose mandatory payroll contributions provide enough funding to cover current expenses. By eliminating the subsidy, the government will save about $1 billion a year, Correa said in a March 28 speech.
As the government was previously paying the subsidy with bond…

GMO Settles With Ecuador Over Bonds That Defaulted in 2009

By Katia Porzecanski and Nathan Gill (Bloomberg) -- Grantham, Mayo, Van Otterloo LLC, a Boston-based money manager, dismissed its lawsuit against Ecuador over debt the nation defaulted on six years ago.
The parties agreed to dismiss the suit filed in December in Manhattan federal court, agreeing that each side would pay its own costs and that the complaint wouldn’t be refiled, without disclosing other terms, according to a March 23 court filing.
GMO said in its complaint that it owned Ecuador sovereign notes due 2030 with a face value of $15.9 million. President Rafael Correa defaulted on $3.2 billion in bonds in late 2008 and early 2009, declaring the debts illegal and illegitimate. The government then repurchased most of the securities at about 35 cents on the dollar.
The government told potential investors in new notes sold on March 19 that the lawsuit represented a “risk of disruption to the offering,” according to a prospectus obtained by Bloomberg News. Robert G. Jones, a lawye…

GMO Settles With Ecuador Over Bonds That Defaulted Six Years Ago

By Katia Porzecanski and Nathan Gill
(Bloomberg) -- Grantham, Mayo, Van Otterloo LLC, a Boston-based money manager, dismissed its lawsuit against Ecuador over debt the nation defaulted on six years ago.

The parties agreed to dismiss the suit filed in December in Manhattan federal court, agreeing that each side would pay its own costs and that the complaint wouldn’t be refiled, without disclosing other terms, according to a March 23 court filing.

GMO said in its complaint that it owned Ecuador sovereign notes due 2030 with a face value of $15.9 million. President Rafael Correa defaulted on $3.2 billion in bonds in late 2008 and early 2009, declaring the debts illegal and illegitimate. The government then repurchased most of the securities at about 35 cents on the dollar.

The government told potential investors in new notes sold on March 19 that the lawsuit represented a “risk of disruption to the offering,” according to a prospectus obtained by Bloomberg News.

Robert G. Jones, a lawyer for…