KUWAIT, Aug 28 (Reuters) - Kuwait’s state-run Petrochemical Industries Co. (PIC) said it would make an initial compensation payment to Dow Chemical Co after an arbitrator ruled it must pay $2.16 billion to the U.S. group, Bahrain’s Akhbar Al Khaleej newspaper reported on Tuesday.
The International Chamber of Commerce’s International Court ruled in May that the Kuwaiti chemical company should pay the sum for wrongly cancelling a planned plastics joint venture in 2008.
Dow’s law firm Shearman and Sterling LLP said at the time that it was one of the largest arbitration awards ever made and that the court’s decision was final. PIC is a unit of state-run Kuwait Petroleum Corp.
PIC’s managing director Maha Mulla Hussain has sent a letter to oil minister Hani Hussein to request approval for the company to make a first payment of 260 million Kuwaiti dinars ($921 million) the newspaper reported citing unnamed sources.
The sources said PIC’s Hussain had asked the oil minister to place the item on the agenda for the company’s board meeting next Tuesday for approval.
PIC was not immediately reachable for comment. If the report is confirmed, it would be the first time PIC has said it would pay compensation to Dow.
Kuwait pulled out of the $17.4 billion “K-Dow” joint venture with the U.S. company as the global economy sunk into a deep recession nearly four years ago.