By Mark D. Mutschink

Abstract
When Exxon Mobil faced the nationalization of its oil-field projects in Venezuela in 2007, it refused Venezuela’s offer of compensation and instituted international commercial arbitration. The war of words that followed clearly depicted Venezuela’s view toward any perceived infringement on its sovereign hydrocarbon rights. Members of Venezuela’s government called Exxon officials “bandits and thieves . . . trying to steal our future” and Exxon’s arbitration demand and other court actions “judicial terrorism” and “economic hostage-taking.”  In fact, Exxon can be considered fortunate to have been able to negotiate for an arbitration clause in its contract with Petroleos de Venezuela, S.A. (PDVSA), the Venezuelan national oil company (NOC). The arbitration clause put Exxon and PDVSA in a neutral forum and gave Exxon a chance to fight on a level playing field. This legal battle reveals some key issues and raises some important concerns surrounding the dealings between private U.S. companies and NOCs around the world. For example, NOCs have the ability to wield both their private economic power and state power, such as the power to simply nationalize a private company’s assets within their country. Additionally, NOCs seem increasingly hostile to resolving any disagreements outside their own legal systems. Finally, considering NOCs’ importance in the worldwide energy sector, there should be serious concern that NOCs have the power to directly impact the U.S. energy supply on a scale that could affect national security and the economy.

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Recommended Citation
Mark D. Mutschink, Facing the Future of Oil in U.S. Courts: A Recommendation for Changing the Bremen Doctrine on Enforceability of Forum Selection Clauses, 63 SMU L. Rev. 1343 (2010)