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Costa Rica to go to court with U.S. oil company over contract

December 21, 2011

Costa Rica will go to court with U.S. company Mallon Oil after President Laura Chinchilla reaffirmed Wednesday morning that she would not sign an oil exploration contract.

In 2000, then-President Miguel Ángel Rodríguez (1998-2002) awarded Mallon Oil a contract to look for oil and natural gas in the north of the country for 20 years.

Approximately 200 court appeals, filed mainly by environmental groups, blocked the project for more than a decade. The Constitutional Chamber of the Supreme Court in April rejected the last of the appeals. But Chinchilla, backed by the support of many government officials and environmentalists, maintained she would not allow oil exploration to take place within the country.

On Monday, Mallon Oil sued the Costa Rican government after Chinchilla refused to sign the contract, the daily La República reported. Chinchilla then had 15 days to decide if she should sign the contract or go to court. Two days later, she made her decision final to not sign the contract.

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