Reuters | September 19, 2024
A Citgo oil refinery in Lemont, Illinois. Source: Getty Images.
Canadian miner Gold Reserve said on Thursday it has dropped out of a US court-organized bidding for shares in a parent of Venezuela-owned oil refiner Citgo Petroleum, citing court delays, and uncertainty over the sales process.
The move came on the same day the court official overseeing the bidding asked the federal court in Delaware to grant him additional time to conclude discussions with a bidder on sale terms. Creditors filing parallel lawsuits against Venezuela have affected the talks, the official said in a filing.
Houston-based Citgo, the seventh largest US refiner by volume, is the crown jewel of Venezuela’s companies overseas and has been the target of creditors seeking compensation for late President Hugo Chavez’ nationalization wave and President Nicolas Maduro’s failed debt payments.
The court found the Citgo parent liable for debt defaults and expropriations and 18 creditors holding rulings totaling $21.3 billion are pursuing proceeds from the auction of shares in PDV Holding that was launched last October. Offers are not expected to cover that amount entirely.
Gold Reserve had submitted a bid on June 11 for shares in PDV Holding.
However, the company, which has a more than $1 billion claim, said in a statement it was concerned by a stay motion filed this week by Venezuela and PDV Holding, given the three extensions to naming a winner to date.
“We have worked with many great partners during this prolonged process but now, given the elapsed time, uncertainty and lack of visibility on the outcome, we are on our own and outside of the bidding,” said Paul Rivett, executive vice chair, in a statement.
He said the company hopes the court officer overseeing the bidding “will recommend a fair deal to the court and judgment creditors soon.”
Robert Pincus, the court official overseeing the sale, on Thursday sought a fourth delay to complete his negotiations on sale terms in a filing with the court. He asked to be given until Sept. 26 to continue talks and proposed the court now schedule a hearing on the recommendation for Dec. 3.
The court officer overseeing the auction “has not disclosed any specifics concerning the status of the negotiations” with the remaining bidders, Gold Reserve said.
The court also has not provided “any specifics concerning the procedures for other potential bidders to submit topping bids after the sales motion is filed,” it added.
(By Marianna Parraga; Editing by Gary McWilliams and Marguerita Choy)
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