From Argus Media

Bogota, 22 May (Argus) — Venezuelan state-owned PdV is preparing to resume oil supply to Curacao’s fuel distributor Curoil as early as today in the first sign of a breakthrough in a protracted debt-related dispute with US independent ConocoPhillips.

Lawyers for PdV and ConocoPhillips met yesterday in the Dutch-controlled island to hammer out execution of an 18 May local court order that partially lifted liens that the US firm had levied on PdV’s local assets in a bid to collect a $2bn arbitration award.

The court decision and a parallel ruling in the Dutch island of Bonaire, where PdV owns the 10mn bl Bopec storage terminal, were aimed at ensuring fuel supply for local utilities.

The Curacao government expects that PdV will restart the 330,000 b/d Isla refinery by early June in order to fulfill its commitment to meet demand as locally stored fuel is drawn down. The court ruling effectively cleared PdV to resume crude shipments to Curacao, without the risk of court-ordered seizure.

The arrangement takes operational pressure off of PdV, even though the Venezuelan company will be forced to give up revenue, and risks other creditors following in the lead of ConocoPhillips. PdV officials told Argus that a prolonged dispute would have eventually led the firm to shut in production because of limited storage in Venezuela.

For now, shipping sources in Curacao tell Argus that there is no activity at the Bullen Bay terminal which PdV leases along with the refinery. The long-term lease on the refinery and terminal expires in December 2019.

In their rulings last week, the Dutch Caribbean courts ordered that revenue generated by PdV’s local oil sales will go into escrow accounts. Once the local courts recognize the International Chamber of Commerce award to ConocoPhillips, the revenue can be distributed, partially to the US company to pay down the debt and partially to PdV. This process could take at least two months.

ConocoPhillips started levying liens on PdV assets in early May in an effort to force the company to pay the award, which stems from the 2007 expropriation of its Venezuelan assets.


From CNBC/Reuters – May 14, 2018

Conoco Seized Venezuela PDVSA Products from the Isla Refinery: Curacao

ConocoPhillips has seized products belonging to Venezuelan state oil company PDVSA from the Isla refinery it runs on Curacao. Conoco has won court orders allowing it to seize PDVSA assets on Caribbean islands.

The company is trying to collect on a $2 billion arbitral award linked to the 2007 nationalization of Conoco assets under late leader Hugo Chavez.

U.S. oil major ConocoPhillips has seized products belonging to Venezuelan state oil company PDVSA from the Isla refinery it runs on Curacao, an island official told Reuters on Sunday.

Conoco has won court orders allowing it to seize PDVSA assets on Caribbean islands, including Curacao, in efforts to collect on a $2 billion arbitral award linked to the 2007 nationalization of Conoco assets under late leader Hugo Chavez.

PDVSA products from the installations of the Isla refinery have been confiscated. We dont have any way to get them, said Steven Martina, Curacaos minister for economic development, who did not provide the amount or value of the seized products.

Conoco and PDVSA did not immediately respond to requests for comment.

Martina added that Curacao was planning to meet with PDVSA and Conoco this week to discuss the dispute that has led Conoco to seize Venezuelan assets in the Caribbean, wreaking havoc on PDVSAs export chain.

The dispute has also caused worry on Curacao, a constituent country within the kingdom of the Netherlands with a vibrant tourism industry and deep-water ports used by the oil industry. The island is heavily dependent on the refinery, which provides as much as 10 percent of Curacaos gross domestic product and is a big source of employment on the island just off Venezuela.

“There is no need to be alarmed, fuel and services are guaranteed,” Curacao’s Prime Minister Eugene Rhuggenaath said in a news conference on Sunday. He added that lawyers are also contacting Conoco to “reach a deal and negotiate.”

PDVSA is preparing to shut a Caribbean refinery that is running out of crude amid threats by Conoco to seize cargoes sent to resupply the facility, two sources with knowledge of the situation told Reuters on Friday.

But Martina said the 335,000 barrel-per-day Isla refinery was still operating, albeit at low levels, thanks to Curacao’s reserves.

 


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