Capping off a year of financial difficulties, news broke today that PDVSA has mortgaged all of its remaining shares in Citgo to Russian state-owned oil giant Rosneft. Today’s move means that all of PDVSA’s shares in Citgo are now acting as collateral for one finance deal or another, as the former oil giant struggles to stay afloat.
Earlier this year, PDVSA placed 50.1% of its shares in Citgo as collateral in a bond swap.
News of the deal came from the Latin American Herald Tribune, which reported that PDVSA “secretly mortgaged” Citgo’s three refineries in the United States to Rosneft, meaning that the refineries will go to the Russian oil company if PDVSA fails to meet its financial obligations with Rosneft.
PDVSA reacted today by confirming the move, and suggesting that Venezuela’s enemies are making continuing to “attack the company” through sensationalist coverage of the news. A press release from PDVSA partially reads:
It’s important to point out that any world-class company, as is PDVSA, uses its assets to back-up its transactions and leverage its investments, which is why it is completely false [to say that PDVSA is] ceding assets to third parties. Just as PDVSA leveraged itself in October with 50.1% of its shares in Citgo as a guarantee for a bond swap, it has used the 49.9% remaining to leverage new financing…
At the same time, PVSA stressed that it “maintains total ownership and control” over Citgo.
Spain Grants Citizenship to Goicoechea, Zuloaga
The Spanish government granted citizenship to Yon Goiocoechea and Guillermo Zuloaga in a show of solidarity with the plight of those who are persecuted politically in Venezuela.
Goicoechea is a member of the Voluntad Popular (VP) opposition party, and was arrested by authorities in August on false charges that he was involved in a terrorist plot. Yon remains in custody to this day under deplorable conditions.
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