WASHINGTON, D.C. -- Koch Industries has launched an arbitration case against Venezuela before the dispute body of the World Bank, the International Center for Settlement of Investment Disputes (ICSID). The complaint was brought by two of Koch’s subsidiaries, which funded and built Venezuela fertilizer company Fertilizantes Nitrogenados de Venezuela (FertiNitro). This is the eighteenth case against Venezuela before the World Bank’s ICSID.
Koch representatives did not specify the amount of the claim and according to the website of ICSID, the docket for the case has not yet been formed
Koch is a closely-held corporation owned by the Koch brothers, stalwart funders of the right-wing US Tea-Party.
Costing $1.1 billion dollars to build, Fertinitro ranks as one of the world’s largest nitrogen-based fertilizer plants, with daily production capacity of 3,600 metric tons of ammonia and 4,400 metric tons of urea. Until the Chavez government expropriated it in October of 2010, Fertinitro was owned 35% by a Koch subsidiary, 35% by Venezuela state petrochemical company Pequiven, 20% by a Snamprogetti subsidiary of Italian oil company ENI, and 10% by Venezuela's private food and beverage giant Polar.
Both ENI and Polar have suffered repeated nationalizations and expropriations under the Chavez government. However, ENI just signed a new $2 billion loan agreement to Venezuela's state oil company PDVSA, including $1.5 billion to develop early producting in the Orinoco Oil Belt's Junin 5 block and build an associated refinery, and $500 million for a thermal power generation plant that will supply electricity to PDVSA's offshore gas projects. Venezuela President Hugo Chavez continuously attacks Polar's head, Lorenzo Mendoza, one of the five richest Latin Americans according to Forbes.