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ConocoPhillips (COP) to Get $8.75B for Losing Venezuela Assets

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ConocoPhillips (COP - Free Report) will receive $8.75 billion from the government of Venezuela as compensation for the seizure of its oil assets in the country more than a decade ago, per a report by Reuters.

In 2013, the International Convention on the Settlement of Investment Disputes (“ICSID”) determined that Venezuela had unlawfully taken ConocoPhillips’ interests in three oil projects without payment. Notably, the ICSID deals with arbitration proceedings between contracting states.

A latest ruling granted the U.S. Corporation permission to acquire the World Bank tribunal’s 2019 award, which involves interest that raises the amount owed to the company by at least $1 billion.

In 2019, ConocoPhillips won the award after an international arbitration tribunal ruled that the government of former president Hugo Chavez violated one of Venezuela’s bilateral investment contracts when it assumed control of the company’s stakes in three oil projects.

Venezuela’s primary foreign asset is the United States-based Citgo Petroleum, an oil refiner that has been operating under legal protections from creditors issued by the U.S. Treasury Department. The Venezuela government rejected the court’s latest ruling, claiming that the country would continue to take legal action to preserve its possessions.

Based in Houston, TX, ConocoPhillips currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy space are Liberty Energy (LBRT - Free Report) , TotalEnergies SE (TTE - Free Report) and Petrobras S.A. (PBR - Free Report) , currently sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Liberty Energy offers hydraulic fracturing services to onshore upstream energy companies across multiple basins in North America. LBRT’s debt-to-capitalization stands at just 16% compared with many of its peers that are hugely burdened with debts, accounting for around 50% of their total capital structure.

Liberty Energy has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of A for Growth and B for Value. LBRT is expected to see earnings growth of 266.7% for 2022.

TotalEnergies is among the top five publicly traded global integrated oil and gas companies. TTE is managing long-term debt quite efficiently and trying to keep the same at manageable levels. As of Jun 30, 2022, cash and cash equivalents were $32,848 million. This was enough to address the current borrowings of $14,589 million.

TotalEnergies has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of A for Value, Growth and Momentum. TTE is expected to see earnings growth of 107% in 2022.

Petrobras is the largest integrated energy firm in Brazil. As the company focuses on regaining its financial footing by selling assets and curtailing debt load, it successfully managed to lower gross debt below its 2022 target of $60 billion in the third quarter of 2021, well ahead of time. Post the latest quarter earnings, the figure stands at $53.6 billion.

Petrobras has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of A for Value and Momentum, and B for Growth. PBR is expected to see earnings growth of 128.2% for 2022.

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