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Ecuador Delays Picking Arbitrator In Chevron Case

By Mercedes Alvaro, Of DOW JONES NEWSWIRES

QUITO -(Dow Jones)- Despite a looming deadline, Ecuador hasn't chosen an arbitrator for the claim that Chevron Corp. (CVX) filed last month against it with the Permanent Court of Arbitration in the Hague, and will take some time to appoint a representative.

"The deadline to appoint our representative is today. We are analyzing names and the process could take some weeks," a high government official told Dow Jones Newswires Thursday.

On Sept. 23, Chevron filed an international arbitration claim against the South American country's government, citing violations of Ecuador's obligations under the U.S.-Ecuador Bilateral Investment Treaty, investment agreements, and international law.

The oil giant claims that Ecuador should be held responsible for the damages the company faces in a $27 billion lawsuit over alleged environmental damages in that country's Amazon region in the early 1990s.

The company has denied the allegations, and says that Ecuador's government at the time released the company from any responsibility.

Under rules of the Permanent Court of Arbitration, Ecuador and Chevron should each pick an arbitrator. The two appointees then agree on a third panel member.

Chevron chose Horacio Grigera Naon, director of the Center on International Commercial Arbitration at American University's Washington College of Law.

According to rules of the U.N. Commission on International Trade Law, or Uncitral, if Ecuador doesn't name its representative for the process, Chevron can request the Court of the Hague make the appointment. However, the government official said that Ecuador doesn't expect the court to name an arbitrator.

"Ecuador will name (an arbitrator), but it will take some time."

Local analysts say that Ecuador's tardiness allows it to lengthen the arbitration process.

-By Mercedes Alvaro, Dow Jones Newswires; 5939-9728-653; mercedes.alvaro@ dowjones.com

  (END) Dow Jones Newswires
  10-22-091604ET
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