According to the Financial Times, the payment by the Kuwait state-owned group represents a large proportion of compensation owed to Dow following a ruling by an arbitration court of the Paris-based International Chamber of Commerce.
Joint venture
In the ICC ruling last year, Dow was awarded $2.16bn after KPC subsidiary Petrochemical Industries Company pulled out of the proposed joint venture in December 2008.
After a failed challenge by Kuwait, a further $280m was added to the compensation deal for interest and about $40m in costs.
Good relationship
In a signal that it wishes to maintain a good relationship with Kuwait, Dow is set to forego the $280m interest. In a statement Dow – which has several other joint ventures in the Kuwait - said that it had ‘received assurances from Kuwait Petroleum’ that ‘no retaliatory or punitive actions will be taken against the company and its affiliates as a result of the deed and payments’.
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