The matter of how much Venezuela should be compensated for its 49 per cent shares in Petrojam, Jamaica’s state-owned oil refinery, is now in arbitration before the International Court of Justice (ICJ).

Energy Minister Daryl Vaz provided the update on Friday as he responded to questions from Opposition Member of Parliament for Clarendon South Western, Lothan Cousins, during the sitting of the Standing Finance Committee that examined the 2025/26 Budget.

Cousins wanted to know if Jamaica was prepared for an adverse ruling by the ICJ which was asked to settle the matter in 2023, after Jamaica in 2019, moved to forcefully acquire the 49 per cent stake held by Petróleos de Venezuela’s (PDVSA) in Petrojam.

In February 2019, Prime Minister Andrew Holness tabled a bill in the Parliament for the compulsory acquisition of the shares. The bill provides for the: Ownership of the applicable property to be vested in the Accountant General, in trust for the Government; and for compensation, to be paid to persons having an interest in the applicable property, in accordance with specified rules.

The bill’s “memorandum of objects and reasons” notes that the current ownership structure of Petrojam exposes the country to serious risks, which threaten its energy security and economic stability.

“These risks have exacerbated and made more imminent by sanctions imposed by third-party countries. As a result, a decision has been taken to enact legislation to provide for the compulsory acquisition of the shares held by the Petrojam Corporation of Jamaica,” the bill stated.

It also stated that the fair market value of the applicable property shall be taken to be the 49 per cent of the fair market value of Petrojam Limited, based on the income approach recognised in the valuation referred to in sub-section 2(a) of the bill, which says that the term applicable property covers all shares in Petrojam Limited held by persons other than the PCJ immediately before the new bill comes into operation.

The Government made the move out of concern it could be in violation of United States’ sanctions imposed on the Maduro regime.

On Friday, Cousins said “The issue with Venezuela is live…and it’s something that must be contemplated at all times because there may be an adverse ruling based on how things transpire”.

He also described the issue as “contentious” and asked if the budget would be able to accommodate a payout at any given time.

“The issue of the Venezuela shares is in litigation and the good thing is that the Government of Jamaica put the share value in escrow so the bottom line is that there is no issue…,” Vaz responded.

After he was provided with an update by a member of his team who appeared with him, Vaz told the committee, “I’m just understanding now that it is in international court”. He also noted that it was in arbitration – “that is the step before litigation starts”.

“The fact of the matter is that we can’t project what a ruling will be but the fact that we have made provisions to make sure that if there is a ruling that we can do what we need to do,” Vaz added.

He admitted that the funds being held in escrow are based on Jamaica’s valuation of the shares. Reports are that the Venezuelan Government is seeking US$85 million.

The ICJ is one of six organs of the United Nations. It is the only international court that adjudicates general disputes between nations. It often takes years before arriving at a ruling.