Nevertheless, they are vitally important. The United States is determined to prevent the looting of Venezuelas oil assets by the corrupt Maduro regime.. Note added28/06/2021: impostors are using this site's former editor's full name, and a fake email addresses (alek.boyd.arregui@gmail.com)to send copyright infringement claims / take down requests to web hosting companies (exhibit Hostgator). Webpdvsa | 2,571 followers on LinkedIn. . Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. The Service Contracts system was introduced in 1967 through a partial reform of the Hydrocarbons Law, allowing the nation to negotiate with foreign companies under more advantageous conditions. All of the above was,and continues to be, ignored by Swedish and American authorities. plagiarising this site's content without attribution, eraseinformation about their criminal activities, subordinated hybrid instruments (treated as equity), Spain's tax authority after Alejandro Betancourt. St. James Press, 1991. Websubsidiaries of PDVSA: PDV Holding, CITGO Holding, and CITGO Petroleum (the CITGO Entities). Through its ownership of CITGO Petroleum Corporation, PDVSA also owns refineries at Lake Charles, Louisiana, and refineries at Corpus Christi, Texas. These rules matter. Five years later, in 1948, the Venezuelan congress passed a new income tax law, establishing the so-called 50-50 system that would become a landmark in relations between the international oil companies and the governments of the various oil-producing countries. CITGO is owned by PDVSA through a series of subsidiaries and is considered by many to be the crown jewel of Venezuelas strategic assets abroad. Finally, I discuss the choice-of-law question that lies at the heart of the case. At the time of nationalization, heavy fuel oil accounted for 61% of total products exported. WebSearch By Name. On November 28, 2017, by decree N 3180, published in Official Gazette N 41288, the President of the Bolivarian Republic of Venezuela, Nicols Maduro, names citizen Al Rodrguez Araque, Honorary President of the State Company Petrleos de Venezuela, S.A., PDVSA. features Q&A with leaders in politics, economics, and finance every business day. HECTOR ANDRS OBREGN PEREZVICE PRESIDENTEXECUTIVE, LUIS ENRIQUE MOLINA DUQUE VICE PRESIDENT OF EXPLORATION & PRODUCTION, LEYLI BEATRIZ FERRER AVENDAOVICE PRESIDENT OFPLANNING AND ENGINEERING, HEIFRED JHOSELIN SEGOVIA MARRERO VICE PRESIDENT OF FINANCE, GNESIS SABRINA RON SOLANOVICE PRESIDENT OF INTERNATIONAL COMMERCE AND SUPPLY, JUAN CARLOS DAZ SOCORROVICE PRESIDENT OF COMMERCE AND SUPPLY, GUSTAVO ADOLFO BOADAS DAZ VICE PRESIDENTOF REFINING, JUAN VICENTE SANTANA MIGLIACIN VICE PRESIDENT OF GAS, RONNY RAFAEL ROMERO RODRGUEZVICE PRESIDENT OF INTERNATIONAL AFFAIRS, YURBIS GMEZ EXTERNAL DIRECTOR RICARDO LEN EXTERNAL DIRECTOR SIMN ZERPA DELGADO EXTERNAL DIRECTOR WILLS RANGEL EXTERNAL DIRECTOR RICARDO MENNDEZ PRIETO EXTERNAL DIRECTOR. Prior to nationalization, only 33 exploratory wells had been drilled between 1971 and 1976, compared with 58 wells in 1976 and 225 in 1982. Exclusive news, data and analytics for financial market professionals, Reporting by Luc Cohen and Marianna Parraga This system refers to an agreement where by concurrent owners bear all expenses equally. Libertador con calle El Empalme Complejo MinPetrleo - PDVSA, La Campia, Caracas - Venezuela. Whether the Notes were validly issued depends, in turn, on whether the court applies New York law or Venezuelan law. Guaid appointed a new PDVSA board of directors, which was recognized as the legitimate board by the United States even though it does not control the companys operations inside Venezuela. Please for proper display of our website you should enable it or use another browser that supports it. The Inter-American Dialogue engages our network of global leaders to foster democratic governance, prosperity, and social equity in Latin America and the Caribbean. As the highest governing body of the company, the shareholder meeting is the ultimate authority over the direction and administration of PDVSA. Horacio Medina, former executive of PDVSA 2. Since the aggregate value of the 2020 Notes is far greater than $250,000, and since the 2020 Notes have no relation to personal, family or household services, it may seem that the court should simply apply New York law and call it a day. Copyright 2018, INFODIO. The nationalization of the industry required the creation of a functional structure that would allow normal operation to continue within the new legal scheme. In the fall of 2019, PdVSA planned oil shipments with Rosneft Trading S.A. involving 55 million barrels of crude oil liftings from September to December 2019. Locations. Oil has been known and used in Venezuela since seepages were found on the shores of Lake Maracaibo during the colonial period, which ended in 1910. Privacy Policy. Concurrent with this action, OFAC is issuing a general license that authorizes certain transactions and activities that are ordinarily incident and necessary to the wind down of transactions involving Rosneft Trading S.A. As a result of todays action, all property and interests in property of Rosneft Trading S.A. and Didier Casimiro that are in the United States or in the possession or control of U.S. persons, and of any entities that are owned, directly or indirectly, 50 percent or more by the designated individual and entity, are blocked and must be reported to OFAC. GL 8F extends the validity period of certain maintenance activities involving Petrleos de Venezuela S.A. (PdVSA) until December 1, 2020, but also narrows the scope of the prior license and provides a new authorization for wind-down transactions and activities. Major switching from oil to gas is not envisaged until 1992, after completion of the Nurgas pipeline from Anozategui to the West. Exeario Boscn is a The most important domestic refineries in terms of capacity are Amuay with 630,000 barrels per day and Cardn with 350,000 barrels per day. The assets of the industry were acquired from the ex-concessionaires based on a net book value of US$1.17 billion. learn how over 7,000 companies got started! As president of the National Assembly, he has assumed the powers of interim president in accordance with Article 233 of the Venezuelan Constitution, given the end of the presidential term and the illegitimate elections held last May. 9-13/09/2014. Commercial marketing of the fuel has started at a modest level of 20,000 barrels per day, but could reach 600,000 barrels per day by the middle of the decade. Registered in the Canton of Geneva, Switzerland as a trading company in January 2011, Rosneft Trading S.A. was created to assist Rosneft Oil Company in carrying out its foreign projects. 4.139, published in the Extraordinary Official Gazette; 6,512, the president of the Bolivarian Republic of Venezuela, Nicols Maduro, appointed four new vice-presidents in the core areas of Petrleos de Venezuela, S.A. (PDVSA), as well as the new president of the Venezuelan Petroleum Corporation (CVP), a subsidiary that manages PDVSA's interests in joint exploration and production companies with national and foreign private oil companies. Some lawmakers have sought to require Citgo pay dividends to holding companies Citgo Holding and PDV Holding, according to people familiar with the matter. The questions are: what happened to its 15%stake? https://conflictoflaws.net/News/2020/08/CoL_Banner-1.png, The Billion-Dollar Choice-of-Law Question, PhD/Research Assistant Position at the University of Cologne. . You can explore additional available newsletters here. Houston - December 15, 2020 - The Board of Directors of PDV Holding, Inc. (PDVH) and its subsidiaries welcomes the appointment of Horacio Francisco Medina The original 14 operating subsidiaries were integrated in 1977 into four major companies, Lagoven, Maraven, Meneven and Corpoven. Since the trend toward heavy oil has been reversed with the discoveries of light oil in Monagas and Apure, PDVSA has continued to concentrate its exploration efforts on finding light and medium oil, and between 1988 and 1993 has planned to drill 112 exploration wells to add a possible 9.4 billion barrels of reserves to the existing 58 billion barrels. Further, the court wrote that the district court would not have jurisdiction to conduct the requested inquiry on remand. After the district court dismissed the action for lack of standing and the Eleventh Circuit affirmed, an entity purporting to speak for Petrleos de Venezuela sought to substitute itself as the real party in interest. Board of Directors shall be composed of no less than seven and no more than eleven members appointedby presidential decree for an initial term of two years, renewable for equal terms or until a new Board of Directors is appointed. The lack of any such cases cut against giving the term a broad interpretation. As Maduro continues to resist pressure to resign, sanctions will increasingly restrict his access to cash and hinder his ability to move petroleum. In 2019, the United States recognized Venezuelas Interim President Juan Guaid as the lawful head of state. WebPDVSA is listed in the World's largest and most authoritative dictionary database of abbreviations and acronyms PDVSA - What does PDVSA stand for? The Republic shall be represented by the Peoples Power Minister of Petroleum and other ministers that the President of the Bolivarian Republic of Venezuela may appoint. PDVSA operates under broad It would be interesting to know what was the rationale of the NY lawmaker when it decided that this multilateral choice of law rule should exclude freedom of choice. The prices of Venezuelan government bonds rallied after National Assembly President Juan Guaid declared himself the countrys legitimate president and won official recognition from numerous countries, including the United States. The risk remains high as long as there are two parallel governments. In October 2018, Maduro decreed that the following individuals would comprise the board of PDVSA: Manuel Salvador Quevedo Fernndez; Miguel Jos Quintana Castro; Rodolfo Enrique Jimnez Jimnez; Jos Alejandro Rojas Reyes; Nemrod Antonio Contreras Mejas; Marcos Alejandro Rojas Marchena; Fernando Manuel de Quintal Rodrguez; Yurbis Brussels; Chicago; Denver; Doha; Indianapolis; London; Los Angeles; New York Under this interpretation, the 2020 Notes may not be validly issued because they were never approved by the National Assembly as required under Article 150. The exploration effort will be concentrated on the Furrial-Musipn geological trend in Monagas where 51 wells are to be drilled and on the North-Central section of Lake Maracaibo where 43 wells are to be drilled. It also intends to increase its presence in the European down-stream sector through acquisitions. the validity of a security.. On August 29, 1975, the Organic Law Reserving to the State the Industry and Commerce of Hydrocarbons was enacted, allowing the government to take full control of the oil industry on January 1, 1976. . With this acquisition, PDVSA gained access to a deep conversion refinery near Chicago with an installed capacity of 153,000 barrels per day, as well as distribution and marketing facilities in Illinois, Michigan, Iowa, Ohio, and Wisconsin. On the contrary, Guaid mainly brings upside risk to the Venezuelan debt, even after an orderly debt restructuring process that guarantees payments to debt holders and access to financial markets for the Venezuelan reconstruction. Message to INFODIO readers: investigative journalism, which is what this site does, takes lots of time.Visiting media looking for a quick run down on Venezuela's gargantuan corruption, have the decency to at least cite the source when plagiarising this site's content without attribution (exhibit Reuters hereand here, exhibit Bloomberg here, exhibit OCCRP here). Under the Hydrocarbon Law, every agreement for PDVSA to cede exploration and production rights is illegal and unconstitutional. By the autumn of 1973 the possibility of an early reversion before 1983 was introduced and started to gain acceptance, replacing the original plan to start nationalizing the industry from 1983. PDVSA decided to secure long-term outlets for its crude oil by increasing its presence in foreign downstream markets, mainly in the United States and Europe. Frontera Energy Corporation Executive Director There was progress in the sense that the board of directors was obliged to first meet with President Chvez before making decisions, Paravisini Garca said. The United States has made it clear that we will consider lifting sanctions for those who take concrete, meaningful, and verifiable actions to support democratic order in Venezuela. PDVSA products from the installations of the Isla refinery have been confiscated. The exchange was also approved by the companys sole shareholder and by the boards of the PDVSAs subsidiaries with oversight and control of CITGO. Sources reported that a mezzanine loan given to Nynas by Betancourt and outstanding debt owed to Petrozamora (joint venture formed by Betancourt, Ivanov and co with PDVSA, which wasNynas' largest crude provider), guaranteed GPB's seat at the reorganisation table. The underlying action, brought by a litigation trust on behalf of Petrleos de Venezuela, alleged conspiracy, antitrust, cybercrime, and fraud claims against various individuals and entities. Suite800 Is it growing more or less risky right now to hold Venezuelan debt? Pdvsa is managed by a president and two vice-presidents, each of whom is named to his job for 2 years by the president of Venezuela. the members of its board of directors, are as follows: Ali Rodriguez Araque: Designated PDVSA President in April 2002, Rodriguez has a But what is peculiar in this case is that the mandatory rule, if I understand correctly, is a multilateral choice of law rule. A lot. U.S.-based executives of Citgo may recognize the new board and cooperate in an effort to avoid a PDVSA-bond default. Unlike the 2017 Notes, the 2020 Notes were secured by a pledge of a 50.1% equity interest in CITGO Holding, Inc. (CITGO). Citgo operating chief Edgar Rincon also stepped down from the board of Citgo Holding, according to a statement by the Guaido-led assembly. The products sold are petrol, aviation fuel, diesel fuel, lubricants, kerosene, and asphalt, with petrol accounting for almost half of total consumption. Caracas.-Petrleos de Venezuela, S.A.(PDVSA) announces the appointment of two new members to the Board of Directors of the Company, by decree N 2183 of the Constitutional President of the Bolivarian Republic of Venezuela Nicols Maduro, published in Official Gazette N 40826 of January 12, 2016, in accordance with the existing legal The decisions of the shareholder meeting are binding, within the limits of its powers, on the company. Suscrbete a nuestro boletin de noticias. The proportion of light and medium crude oil in Venezuela's export package declined between 1976 and 1984, with a complementary increase in the volume of heavy crude exports. Rosneft Trading S.A. is a subsidiary of the Russian state-controlled global energy giant Rosneft Oil Company. Following the Bolivarian Revolution, PDVSA was mainly used as a political tool of the government. The President of Venezuela has the power to appoint the board of directors of PDVSA. A default on those bonds would place the refiners equity ownership at the center of foreclosure battles involving bondholders, both Venezuelan presidents and Rosneft, which holds half of the Citgo-collateralized PDVSA bonds. PEDRO RAFAEL TELLECHEA RUIZ PEOPLES MINISTER OF PETROLEUM. Genesis Sabrina Ron Solano, vice In addition, the law established that companies would have to deposit 10% of their assets with the government to ensure that all such assets would be properly maintained by the companies until complete reversion took place. It also sought a declaration that the creditors were prohibited from executing on the CITGO collateral. See here for a complete list of exchanges and delays. The new board of directors filed a lawsuit in the Southern District of New York against the trustee and the collateral agent for the 2020 Notes. CVP was to operate in competition with foreign concessionaires in the country and was to be the official instrument of the country's petroleum policy. The 2020 Notes contain New York choice-of-law clauses. It is PDVSA that has failed to honor our award by ignoring the judgment of the ICC tribunal and other local court orders. WebGiven the current political situation in Venezuela, the PDV Holding board was elected by the ad hoc Board of Directors of PDVSA which was appointed by, and now accountable to, Its last reported accounts, as per website, are for 2020. A succession of grants followed during tne 19th century, and the systematic exploitation of the country's large hydrocarbon reserves started during the 27-year dictatorship of General Juan Vicente Gmez, which lasted from 1908 to 1935. Editing by Marguerita Choy, Oil prices drop as US rate hike fears, weak China data offset supply cuts, KKR to invest $250 million more in India's Serentica Renewables, Japan's JERA sees more LNG going to Asia as domestic demand shrinks, Santos' sale of Papua New Guinea LNG stake to state-owned Kumul delayed to August, Indian cough syrup: mystery middleman may be new clue, Red flags galore: Fed officials cited SVB 31 times, Pentagon awards $7.8 billion F-35 contract to Lockheed Martin, Fed points finger at Trump-era rollback for SVB demise, Kotak Mahindra Bank beats expectations with 26% net profit rise in January-March quarter. We see them around but we don't know what goes on behind the scenes. Gas reserves in the country are estimated at 93 trillion cubic feet of gas. Reuters, the news and media division of Thomson Reuters, is the worlds largest multimedia news provider, reaching billions of people worldwide every day. Together, we work to shape policy debate, devise solutions, and enhance cooperation within the Western Hemisphere. PDVSA reserved the right to reduce the volume of oil placed in this manner by 10% after the first year, and by 20% in the second year. Section 5-1401 states that it shall not apply to any contract to the extent provided to the contrary in . It does not deal with the process of entering into contracts for the transfer of securities or regulate the rights and duties of those involved in the contracting process (emphasis added). 4.789, published in Official Gazette No. See here for a complete list of exchanges and delays. Wilhelm Belloso and Andrs Arvelo Guerrero also joined the PDV Holding ad-hoc board that oversees Citgo. Get free summaries of new Eleventh Circuit US Court of Appeals opinions delivered to your inbox! Justia makes no guarantees or warranties that the annotations are accurate or reflect the current state of law, and no annotation is intended to be, nor should it be construed as, legal advice. All rights reserved. PDVSA continues to invest in its production facilities with the intention of increasing production in a few years' time. The Board of Directors shall be composed of no less than seven and no more than eleven members appointedby presidential decree for an initial term of two years, renewable for equal terms or until a new Board of Directors is appointed. If the 2020 Notes were validly issued, they are binding on PDVSA, and the CITGO assets may be seized by the noteholders in the event of default. PDVSA also owns minority stakes in two refineries in Sweden, and one in Belgium. 2703, published in the Extraordinary Official Gazette of the Bolivarian Republic of Venezuela No.6284. Michelle DiGruttolo, senior managing director at Ankura, and Jay Squiers, managing director in the firms energy restructuring office:The latest sanctions will ensure that trading on both Venezuelan government-issued bonds and PDVSA bonds remains at a virtual standstill. // Photo: @jguaido via Twitter. A fusion of tradition, modernity and surroundings. However, under the amendments that the U.S. Office of Foreign Assets Control (OFAC) made to its regulations on Feb. 1, first, U.S. persons can no longer purchase any additional bonds; second, current bondholders can transfer such bonds to non-U.S. persons only; and third, U.S. financial institutions involved in a transfer or divestment of Venezuelan bonds must review all information that is or should be in their possession to confirm that such bonds are not being transferred to U.S. persons. Guaid appointed a new PDVSA board of directors, which was recognized as the legitimate board by the United States even though it does not control the companys operations inside Venezuela. Venezuela's move toward controlling its oil industry took a significant step in 1943, when the new hydrocarbon law integrated all oil legislation. In my view, the 2020 Notes were invalid ab-initio due to the lack of Assembly approval as required by Article 150, irrespective of corporate law compliance. Minister Luna also addressed some of the upcoming plans his government has in its preparation to host the eighth Summit of the Americas next March in Lima. In August 2019, Rosneft Trading S.A. negotiated a shipment of two million barrels of Venezuelan crude oil with PdVSA and was able to find a vessel willing to transport the cargo despite difficulties that came with doing business in Venezuela. 4. Prior to nationalization, Venezuela's refineries had been geared to use low gravity oil to produce heavy fuel oil for export to its traditional market, the northeast United States. On October 31, 1989, PDVSA acquired 50% of Unocal's downstream assets in the midwestern United States.