Marianna Parraga and Gary Mcwilliams, Reuters

HOUSTON
EnergiesNet.com 08 15 2023

Oil major Exxon Mobil (XOM.N) and 19 other creditors owed money by Venezuela on Monday registered their claims in a U.S. federal court that will soon kick off an auction of shares in PDV Holding, one of the parents of Houston-based refiner Citgo Petroleum (PDVSAC.UL).

Creditors owed billions of dollars from expropriations and defaults by Venezuela have flocked to U.S. courts in recent years to enforce court rulings and arbitration awards against the South American country and its state oil company, PDVSA (PDVSA.UL), which owns Citgo through several companies.

U.S. Judge Leonard Stark last month said miner Crystallex International, which first brought the case in the Delaware-based court, will have priority to proceeds from the proposed auction. U.S. oil producer ConocoPhillips (COP.N) will have a position “near the front of the line” of creditors, he said.

A court official appointed for the case gave all creditors until Monday to file a summary of claims, including rulings in their favor and a recount of money owed plus interest.

At least 20 companies with claims totaling some $10 billion filed summaries hoping to participate in the year-long auction starting in October. The refiner has been valued at $10 billion to $13 billion.

The head of the board supervising Citgo and PDVSA did not immediately respond to requests for comment. Citgo declined to comment.

Among the creditors is Exxon, which had not previously participated in the case brought by Crystallex. Following a July decision by the World Bank’s International Centre for Settlement of Investment Disputes (ICSID), Exxon said it was granted $984.5 million in compensation plus $1.02 million in costs and fees.

An Exxon spokesperson declined to comment on the proposed auction or details of the ICSID award, but said that, on balance, ICSID ruled in its favor.

Exxon’s oil projects Cerro Negro and La Ceiba were expropriated in 2007 by Venezuela’s late President Hugo Chavez, which led to lengthy international arbitration cases.

The list of claims by value in the auction, which could result in the breakup of the seventh largest U.S. refiner, is led by Conoco, a group of defaulted bondholders, Rusoro Mining, Exxon and holders of promissory notes issued by PDVSA.

Reporting by Marianna Parraga; Editing by David Gregorio and Richard Chang

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