PDVSA's supervising board to appeal new creditors' move to go after Citgo

Rusoro Mining

31/03/2023 19:49

HOUSTON, March 31 (Reuters) - A board that supervises
Venezuela's overseas assets said it plans to file an appeal to a
U.S. court's decision granting four firms the right to seize
shares in one of the parent companies of Venezuela-owned U.S.
refiner Citgo Petroleum.
    A U.S. court is preparing for an auction of shares in
Delaware-registered PDV Holding to satisfy a $970 million claim
by Canadian miner Crystallex stemming from a expropriation of
its Venezuelan assets. Other companies have sought to attach
their own judgments to the case, leading to a feud this week
among attorneys over priority.  
    The decision by a U.S. judge in Delaware to approve the
attachments is contingent on green light by the U.S. Treasury
Department. 
    O-I Glass Inc  OI.N , Huntington Ingalls Industries Inc
 HII.N , ACL1 Investments Ltd, and Rusoro Mining Ltd  RML.V 
received the court's blessing after showing state-oil firm PDVSA
was the "alter ego" of Venezuela's government in asset battles.
    An ad-hoc board created by Venezuela's National Assembly in
2019 to supervise PDVSA's foreign subsidiaries, especially
Houston-based Citgo Petroleum, will oppose any conditioned
auction, board's president Horacio Medina told Reuters. 
    Lawyers representing Crystallex and U.S. oil producer
ConocoPhillips  COP.N , which have been fighting for years to
recoup billions of dollars in expropriated assets, complained on
Thursday that rights granted to additional creditors could
complicate any sale.
    "We might need to think about how the court is going to rank
what is now becoming a very significant number of very
substantial claims," said Amy Wolf, an attorney representing
ConocoPhillips. 
    Even without green light from the U.S. Treasury, which has
protected Citgo from creditors in recent years, U.S. Judge
Leonard Stark has set a calendar for an eventual auction and
asked investment banker Evercore Group to begin working on a
tender.
    Stark this week rejected a motion by lawyers representing
Venezuela to disqualify the person appointed to manage the
potential auction, and said he expects to hear by April 7 on
whether the U.S. Treasury would allow a transfer of shares.

 (Reporting by Marianna Parraga and Gary McWilliams
Editing by Marguerita Choy)
 ((marianna.parraga@thomsonreuters.com; +1 713 371 7559; Reuters
Messaging: @mariannaparraga))