US Treasury extends protection to Citgo until 2022
The license that protects the Venezuelan oil subsidiary of the 2020 bondholders was replaced and its expiration deferred to January of next year
The United States Department of the Treasury reported, last Friday through a statement, its decision to extend the PDVSA 2020 bondholders’ 5G protection license to Citgo until January 21, 2022.
The 5G license, which was issued in July and expired in October of this year, was to replace it with the 5H license that establishes protection until next year. In the text of the official statement you can read:
“This general license does not authorize any transaction or activity otherwise prohibited by the VSR, or any other part of chapter V of the 31 CFR. (c). As of September 10, 2021, General License No. 5G, dated July 20, 2021, is replaced in its entirety by this General License No. 5H.”
More than 2 years of protection
As will be recalled, in 2019 the US Department of the Treasury issued a protection license to Citgo in order to prevent PDVSA 2020 bondholders from seizing its shares.
From the first protection appeal it was established that the company’s shares cannot be transferred, highlighting: “Transactions related to the sale or transfer of Citgo shares in relation to the PDVSA 2020 bond are prohibited until that date.”
The first time that the Treasury Department issued a protection license, it had an expiration date of October 29, 2019, but since then the US institution has been extending the issuance date, with the intention that the bond debt be paid.
On the other hand, the agency pointed out: that “a possible agreement to renew the bond payments could require additional licenses.”
Currently, Citgo is managed by a temporary board that cancelled all types of relationship with PDVSA, once the US will sanction Venezuela in order to paralyze the cash flow to the Latin American country and increase pressure to achieve the resignation of the President Nicolás Maduro.
Citgo was considered the most important branch of PDVSA abroad, with the capacity to operate three refineries, with more than 3 million employees, and responsible for supplying “fuel to a retail network that encompasses some 30 North American states.” The year 2020 generated profits in the order of “851 million dollars.”
M. Rodríguez
Source: impactovenezuela
