(Reuters) - An arbitrator ruled Kuwait’s state-run chemical company must pay Dow Chemical Co $2.16 billion for wrongly canceling a planned plastics joint venture in 2008, Dow said on Thursday.
The International Chamber of Commerce’s International Court ruling against Petrochemical Industries Co (PIC) of Kuwait is final and binding and believed to be one of the largest ever arbitration awards, according to Dow’s law firm, Shearman and Sterling LLP.
Kuwait pulled out of the $17.4 billion “K-Dow” petrochemical joint venture as the global economy sunk into a deep recession nearly four years ago, triggering charges from Dow that it had violated agreements.
“This outcome brings resolution and closure to the issue,” Andrew Liveris, Dow’s chairman and chief executive, said in a statement.
A Dow spokeswoman said it wasn’t known when the company would receive the money from PIC.
PIC, a unit of the Kuwait Petroleum Corp, said it was considering its legal options.
“The company’s management is discussing with lawyers all of the legal proceedings that are available,” according to a statement by PVC’s chairman and managing director Maha Mulla Hussain, cited by state-run news agency KUNA.
Dow and PIC currently operate four other joint ventures, including ME Global, EQUATE, Kuwait Olefins Co and Kuwait Styrene Co.
Shares in Dow climbed 2.8 percent to $31.37 on the New York Stock Exchange.
Reporting By Matt Daily in New York and Sylvia Westall in Kuwait, addition reporting by Tom Hals in Wilmington; editing by Gerald E. McCormick and Jeffrey Benkoe