06/12  Closing Prices / revised 06/13/2024 07:25 GMT 06/12 OPEC Basket  $83.10   +$0.74 cents  06/12 Mexico Basket (MME) $73.29  +$0.66  cents  | 04/30 Venezuela Basket (Merey)   $74.91   +$3.93 cents | 06/12 NYMEX WTI Texas Intermediate July CLN24 $78.50  +$0.50 cents  | 06/12 ICE Brent August  BRNQ24    $82.60  +$0.68 cents  | 06/12 NYMEX Gasoline June RBN24 $2.39  -0.6%  |  06/12 NYMEX  Heating Oil July  RBN 24    $2.44  +0.8% | 06/12 Natural Gas July NGN24  $3.04   -2.7%  | 06/07 Active U.S. Rig Count (Oil & Gas)   594  -6  | 06/13 USD/MXN Mexican Peso   18.7374  (data live)  | 06/13 EUR/USD     1.0809 (data live)  | 06/13 US/Bs. (Bolivar)   $36.44970000 ( data BCV)

PDVSA bondholders dismiss claims that Citgo-backed notes are invalid – Reuters

A Venezuelan flag next to some flags of Venezuela's state oil company PDVSA is pictured near the company's headquarters, in Caracas, Venezuela March 20, 2023. REUTERS/Leonardo Fernandez Viloria
A Venezuelan flag next to some flags of Venezuela’s state oil company PDVSA is pictured near the company’s headquarters, in Caracas, Venezuela March 20, 2023. (Leonardo Fernandez Viloria/Reuters)

Luc Cohen, Reuters

NEW YORK
EnergiesNet.com 06 07 2023

Holders of bonds issued by Venezuelan state-owned oil company Petroleos de Venezuela (PDVSA.UL) that are backed by a majority stake in refiner Citgo Petroleum (PDVSAC.UL) urged New York state’s highest court to reject claims that the bonds are invalid.

Lawyers for Venezuela’s opposition, which has controlled PDVSA’s U.S. assets including Citgo since 2019 due to sanctions on President Nicolas Maduro’s socialist government, in April argued to the Albany-based New York State Court of Appeals that the bonds were not approved by the South American country’s National Assembly.

The bondholders’ trustee MUFG Union Bank and GLAS Americas, their collateral agent, countered that the contention that the bonds were illegal under Venezuelan law has no bearing in New York where they were issued.

They also said the National Assembly, controlled by the opposition when the bonds were issued in 2016, never declared the bonds illegal.

“The New York courts should not encourage issuers to try to avoid their debts by abandoning their own previous commitments and representations,” lawyers for MUFG and GLAS wrote in a June 2 filing made available this week.

PDVSA defaulted on the bonds, which matured in 2020, as an economic catastrophe left Maduro’s government strapped for cash.

The bonds are backed by a 50.1% stake in Citgo Holding, a Delaware-registered entity through which PDVSA owns Citgo(PDVSAC.UL) . The eighth-largest refiner in the United States, Citgo’s assets have been valued at some $13 billion and include a 807,000 barrel-per-day refining network.

To avoid losing control of Citgo, Venezuela’s opposition filed suit in Manhattan federal court, arguing the lack of National Assembly approval rendered the bonds unenforceable.

U.S. District Judge Katherine Polk Failla initially sided with the bondholders. But the Manhattan-based 2nd U.S. Circuit Court of Appeals later said a section of New York state’s commercial code could be interpreted as implying that the validity of a security, such as a bond, is determined by the local law of the jurisdiction where it is issued.

That court asked the New York State Court of Appeals to consider the question.

Reporting by Luc Cohen in New York; Editing by Richard Chang

reuters.com 06 06 2023

Share this news

Support EnergiesNet.com

By Elio Ohep · Launched in 1999 under Petroleumworld.com

Information & News on Latin America’s Energy, Oil, Gas, Renewables, Climate, Technology, Politics and Social issues

Contact : editor@petroleuworld.com


CopyRight©1999-2021, EnergiesNet.com™  / Elio Ohep – All rights reserved
 

This site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission fromPetroleumworld or the copyright owner of the material.

 
 
Scroll to Top