A couple news items of note regarding potential changes of control over refineries owned or used by Petroleos de Venezuela SA, Venezuela’s state oil company. Neither of these are serious issues, though they could become serious one day.
Citgo: The U.S. refining and marketing subsidiary of PDVSA is one of the many attachable assets available to the plaintiffs if they win a long, strange bond case winding through U.S. courts. However, that case is nowhere near a conclusion, despite what the always reputable New York Post may have to say. Personal to JC: it’s always good to read case filings before citing NY Post as an authority. It seems that the recent appeals questions mentioned in the Post story are just about whether Venezuela has sovereign immunity in the case. There is no decision yet on the merits of the case. The plaintiff’s lawyer is throwing all sorts of rhetoric around, but even if he wins, it’s not clear to me that the damages will be anything like what he’s talking about. So for now, this isn’t a serious issue.
Isla refinery: The refinery owned by and located on the island of Curacao is now leased to PDVSA through 2019. This rather cryptic news report in Amigoe (Curacao-based newspaper) says the two governments are to meet. Many locals want a change of control. It’s unclear what PDVSA wants.
The Venezuelan Premier Hugo Chávez is making preparations to meet with the Curaçao Premier Gerrit Schotte, during which meeting they will discuss amongst others the future of the Isla-refinery. Schotte said this in response to questions from GroenLinks Lower Chamber member Ineke van Gent, during a meeting of the Premier with the Kingdom Relations committee.
Van Gent was given the opportunity to ask Schotte in person about his ideas on the refinery, after she had taken the initiative for a motion last week in pressing the Curaçao government to present a future vision before February 1st. “The Isla has considerable priority”, says Schotte. “I have already met with the Isla-personnel and I indicated my intention to speak with the top. Last week, Chávez asked which days are convenient for a meeting. The political will is there, but I cannot take this decision by myself. We must negotiate with the PdVSA….The Premier emphasized that the refinery also has an economical value in providing 2000 to 3000 people –who are involved with the refinery one way or the other– with a daily meal. “I cannot simply dismiss the employees.” He also mentioned the possibility of relocating the refinery activities to Bullenbaai.