• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 4 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 7 days If hydrogen is the answer, you're asking the wrong question
  • 22 hours How Far Have We Really Gotten With Alternative Energy
  • 11 days Biden's $2 trillion Plan for Insfrastructure and Jobs

Rosneft Aims To Dump Citgo Stake As U.S. Sanctions Loom

Rosneft and PDVSA are negotiating the swap of the 49-percent stake in Citgo that the Russian company holds as loan collateral for a number of other assets and products, sources close to the negotiations told Reuters. The negotiations were prompted by the possibility that Washington may impose sanctions on Venezuela, including the suspension of crude oil imports from the country, which will threaten Citgo’s long-term sustainability.

Rosneft lent about US$1.5 billion to PDVSA last year, receiving as collateral a 49 percent stake in Citgo, which had U.S. legislators worried about a Russian state-owned company gaining a foothold in U.S. oil and gas should PDVSA default on the loan.

For Rosneft, this is not an ideal situation, either, in the context of the sanctions that specifically target, among other entities, Rosneft’s head, Igor Sechin.

Now, Rosneft’s 49.9-percent stake in Citgo could be exchanged for eight other assets and deals. These include, according to the Reuters sources, shipments of refined products from Citgo in payment for part of the loan as well as majority stakes in three oil fields and minority stakes in two gas fields.

In addition, Rosneft could receive rights to sell condensate from one of the gas fields it would gain a stake in, Rio Caribe. Also, the Russian company would gain the rights to market its share of the output from all Venezuelan oil fields operated by JVs between it and PDVSA. Other JV partners in Venezuela’s oil industry are required to sell their share of the output to PDVSA itself rather than export it.

Earlier this week media reports emerged quoting senior U.S. government officials as saying the Trump administration is considering sanctions against certain Venezuelan officials as well as against the country’s oil industry as a whole, including halting oil imports from its third-largest supplier of crude.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News