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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. Finally, we can read about how these great companies came about with Company Histories.. ENERGY ANALYTICS INSTITUTE (EAI) 1 July 2020 (Reuters, 1.Jul.2020) Venezuelas opposition-held National Assembly on Tuesday named three new members to PDVSA Careers and Employment | Indeed.com On January 09, 2023, according to decree N 4.765 published in the Extraordinary Official Gazette N 6.731, citizen PEDRO RAFAEL TELLECHEA RUIZ is appointed as president of the Oil State Company, Petrleos de Venezuela, S.A. (PDVSA), and its Board of Directors. WebPresident of the Board of Directors Contact 2 Contact 3 See All Contacts Dynamic search and list-building capabilities Real-time trigger alerts Comprehensive company profiles Valuable research and technology reports Get a D&B Hoovers Free Trial Financial Data A holding company, PDVSA, was established to coordinate, supervise, control, and plan the activities of its subsidiaries made up of the 14 former operating companies. In September 2019, PdVSA supplied a shipment of one million barrels of Merey-16 to Rosneft Trading S.A., which was loaded on a vessel in Venezuela and destined for Asia. Irrespective of who triumphs, we anticipate a lengthy restructuring battle with all parties taking a haircut., Javier Coronado, associate attorney at Diaz, Reus & Targ:Based on the notion that international pressure would soon lead to a new government with which creditors could negotiate payment, investors were seeing Venezuelan bonds as a good deal. Its last reported accounts, as per website, are for 2020. The district court cannot question the validity of then-President Guaids appointment of an alternative board of directors. Since 1978 it has been responsible for the petrochemical sector, and in 1985 it was entrusted with the development of the country's coal resources located in western Venezuela. N.Y. General Obligations Law 5-1401 states that a New York choice-of-law clause should be enforced whenever it appears in a business contract worth more than $250,000 in the aggregate. The opposition has moved to appoint a new board of directors for Citgo. Prior to nationalization, only 33 exploratory wells had been drilled between 1971 and 1976, compared with 58 wells in 1976 and 225 in 1982. Informe de Coyuntura Venezuela (abril-2023) - Academia.edu After nationalization, PDVSA began to diversify its exports, seeking to increase its supply of white products--gasoline and jet fuel--which are traditionally more in demand and afford a higher profit margin. In 1876, a report submitted to the president of Zulia on the petroleum and asphalt deposits in the Maracaibo basin indicated the existence of an oil seep near Tarra, producing 5,760 gallons a day. Citgo operating chief Edgar Rincon also stepped down from the board of Citgo Holding, according to a statement by the Guaido-led assembly. It held that the 2020 Notes were valid and enforceable and that the defendant trustee was entitled to judgment in the amount of $1.68 billion. These rules matter. WebPetrleos de Venezuela, S.A. (PDVSA, Spanish pronunciation: [peeesa]) (English: Petroleum of Venezuela) is the Venezuelan state-owned oil and natural gas company. Copyright (c) 2022 Company-Histories.com. IN THE SUPREME COURT OF THE STATE OF DELAWARE Delaware Court of Chancery 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. Creditors holding roughly $2.8 billion in 2017 Notes decided to participate and exchanged their notes for 2020 Notes. Finally, the district court noted the virtual absence of any New York case law supporting the broad interpretation of the validity favored by the plaintiffs. Treasury Targets Russian Oil Brokerage Firm for Supporting A lot. 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. What would happen to Venezuelas defaulted bonds if President Nicols Maduro steps down, and what would happen to them if he remains in power? WebCaracas.- On May 3, 2018, Decree N 3398 of the Presidency of the Republic was published in Official Gazette N 41389, by means of which the Board of Directors of Petrleos de Este giro en el comportamiento de la actividad econmica fue promovido por un On July 9, the Incumbent Directorsthe current directors of the CITGO Entities appointed through Guaids PDVSA Managing Board filed an Answer and Counterclaim for a declaration that they compose the rightful boards of the CITGO Entities. Incompetence within the company has led to serious inefficiencies and accidents as well as endemic corruption. Oil company from Venezuela. Citgo's current administration has never been opposed to paying dividends to its shareholder, the company said in a statement. 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. The publication is available to members of the Dialogues Corporate Programand others by subscription. A fusion of tradition, modernity and surroundings. As consumers, we often take for granted all the hard work that goes into building a great company. Rosneft Trading S.A. is a subsidiary of the Russian state-controlled global energy giant Rosneft Oil Company. 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. 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. governs . features Q&A with leaders in politics, economics, and finance every business day. The opposition has moved to appoint a new board of directors for Citgo. PDVSA's last representative was Oswaldo Perez (Vice President Finance atPDVSA). On March 21, 2023, by decree No. You can explore additional available newsletters here. 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 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. 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. The US also used personal sanctions first selectively imposed by the Obama administration in 2015 to target top government officials and political figures as well as private-sector actors believed to be connected with the Maduro government. The discussion highlighted the Ministers position on the best way for the international community to handle the crisis in Venezuela and how to confront infrastructural-based corruption throughout Latin America. On October 13, 2022, the U.S. Court of Appeals for the Second Circuit declined to provide a definitive answer as to the interpretive question discussed above. Billions of dollars were riding on the answer. Horacio Medina, former executive of PDVSA 2. Maduro's regime is insisting in the oil industry's de-facto privatization, which is aggravating its collapse. Without Assembly approval, the 2020 Notes could even be deemed as legally non-existent under Venezuelan law and, as such, they could not have any effect inside or outside Venezuela, because the choice of law clause electing New York law as applicable lacked the Assembly approval for it to begin its effectiveness in the first place. WebThe members of the Board of Directors of PDVSA are: President: Manuel Quevedo Fernndez Vicepresident of Production and Exploitation: Miguel Quintana Castro, substituting Nelson The court observed that if the term validity were given a broad scope, it would swallow whole any choice of law analysis involving the formation of a contract for securities. The court cited state legislative history indicating that the term validity in Article 8 referred merely to whether a security ha[d] been issued pursuant to appropriate corporate or similar action. The court also quoted the authors of a leading treatise on Article 8 as saying that: Obviously, the concept of invalidity as used in this section must have a narrower scope than one might encounter in other legal contexts, e.g., in a dispute about whether the obligation represented by the security is enforceable or legal, valid, and binding.. As President of PDV Holding, Inc., Samuel Wilhelm is an experienced global oil and gas business Exeario Boscn. IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE 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. The plaintiffs appealed. WebPDVSA SERVICES | 10,410 followers on LinkedIn. Although heavy fuel yield dropped from 61% in 1976 to 27% in 1986, it was still too high in 1991 for PDVSA's key U.S. market, where heavy fuel oil amounts to only 8% of total demand. PDVSA supplies the domestic market with approximately 335,000 barrels per day of petroleum products, which represent approximately 20% of total production. 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. 13850, as amended, for operating in the oil sector of the Venezuelan economy. The Executive Committee is the administrative body of governance immediately below the Board of Directors of PDVSA. 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. In its first year of operation, PDVSA received net income of US$825.6 million, increasing to US$1.88 billion in 1977, but with the decline in oil prices the company's net income also suffered, falling to US$731 million in 1988. at Transnational Litigation Blog in the weeks and months ahead. Websovereign. Websubsidiaries of PDVSA: PDV Holding, CITGO Holding, and CITGO Petroleum (the CITGO Entities). If Citgo declares a dividend, under direction of the newly appointed directors, they could direct the dividend to fund the required payment on the PDVSA bonds to avoid default. Subsidiary Propernyn PDVSA bought 50% of CITGO from the Southland Corporation. In so doing, the court commented on the issues importance to the States choice-of-law regime and status as a commercial center. It also noted the importance of the choice-of-law issue to the ultimate outcome in the case: If the court concludes New York choice-of-law principles require the application of New York law on the issue of the validity of the 2020 Notes, and that Article 150 and the resolutions have no effect on the validity of the contract under New York law, then we would affirm the district courts decision to apply New York law and uphold the validity of the bonds. Skip to main content LinkedIn. 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. Principal Subsidiaries: Corpoven; Maraven; Lagoven; Interven; Refineria Isla (Curaç); PDV (U.S.A.); PDV (Europe) (U.K.); Intevep; Bariven; Pequiven; Palmaven; Carbozulia. These discoveries will have a profound impact on the country's crude export mix, as the Monagas prospects, which currently produce 80,000 barrels per day of light oil, are expected to reach plateau production--the stable production period before the field declines--of 500,000 barrels per day in 1994. STANDS4 LLC, 2023. In this post, I first review the facts of the case. PDVSA is also developing its large Orinoco oil belt using a new patented production method. Identifying information on the entity and individual designated today. It is also worth repeating that Francisco Convit, a GPB associate, is a Justice Department fugitive. The Human Consequences of Economic Sanctions This site is protected by reCAPTCHA and the Google. The Billion-Dollar Choice-of-Law Question Conflict of Laws Current gas production is between 3.6 million and 3.8 million cubic feet of gas per day of which one-third is sold locally, about one-third reinjected into the reservoirs, 21% used by the oil industry and 5% flared. The Board of Directors shall be composed of no less than seven and no more than eleven AL RODRGUEZ ARAQUE +. If Maduro stays in power, the Venezuelan economy will continue its meltdown, and markets will not get any credible promise of payments. 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. And even if the Department of State declared today that the Maduro entity is authorized to bring suit in Petrleos de Venezuelas name, the court would still affirm because, under Article III, a justiciable case or controversy must exist through all stages of the litigation, including at the time the complaint is filed.. It has the same powers and responsibilities as the Board of Directors, under Board of Directors resolution No. Javier Linares, member of the board of directors of a subsidiary of the company It sought a declaration that the entire bond transaction is void and unenforceable because it was never approved by the National Assembly. Then congress chief Juan Guaido appointed new boards and won U.S. court recognition of their authority over the refining subsidiary. All of the above was,and continues to be, ignored by Swedish and American authorities. 2008-20 on September 12, 2006, except for budget approval, Management Report, and any other decisions related to the indebtedness of the corporation, all of which have to be ratified by the Board of Directors to be legally valid. Disclaimer: Justia Annotations is a forum for attorneys to summarize, comment on, and analyze case law published on our site. The risk remains high as long as there are two parallel governments. It has activities This field covers an area of approximately 42,000 square kilometers and is considered one of the most important untapped reserves of heavy oil in the world. 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. 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 Venezuelan PDVSA The government of Hugo Chvez (1999-2013) tried to recover PDVSA in a process of confronting the coup attempts carried out, for example, with the oil strike in 2003. The products sold are petrol, aviation fuel, diesel fuel, lubricants, kerosene, and asphalt, with petrol accounting for almost half of total consumption. These discoveries have added between 10 and 12 billion barrels of light and medium grade crude oil to a reserve base which was disproportionately biased towards heavier oils. The Inter-American Dialogue engages our network of global leaders to foster democratic governance, prosperity, and social equity in Latin America and the Caribbean. This was the result of increased exploration activity and the addition of 26 billion barrels from the Orinoco oil belt. Under the principle of Constitutional supremacy, applicable within Venezuela and also in the US, that should have been noted by the 2nd Circuit, the 2020 Notes would need to be *independently* valid under both Venezuelan constitutional law and corporate law to be enforceable in Venezuela and abroad. Do Sanctions Mean for Holders of Venezuela The upgrading of PDVSA's refineries was two-thirds completed when it was halted in 1986 because of low oil prices. But what is peculiar in this case is that the mandatory rule, if I understand correctly, is a multilateral choice of law rule. All rights reserved. Houston - December 15, 2020 - The Board of Directors of PDV Holding, Inc. (PDVH) and its subsidiaries welcomes the appointment of Horacio Francisco Medina The El Tablazo plant produces olefins, caustic soda, and chlorine, which are sold to other nearby industries. PDVSA See here for a complete list of exchanges and delays. New PDVSA Board of Directors installed and sworn in PDVSA.COM / Tuesday, 10 January 2023 COMPARTIR: ACCESOS RPIDOS Subsidiaries PDVSA Radio Revista 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. He is also the Respondents' fact witness for oil production issues for the purposes of their quantum 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. 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. Profits were also used to assist the presidency, with funds directed towards allies of the Venezuelan government.With PDVSA focusing on political projects instead of oil production, mechanical and technical statuses deteriorated while employee expertise was removed following thousands of politically-motivated firings. 2703, published in the Extraordinary Official Gazette of the Bolivarian Republic of Venezuela No.6284. Get instant definitions for any word that hits you anywhere on the web. That sum is just part of $21.2 billion that PDVSA holds in commercial accounts receivables - including $3.6 billion that are potentially unrecoverable - Reuters disclosed last week. Morn manufactures fertilizers as well as several chemicals for the domestic market. 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. 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. The Inter-American Dialogue hosted a private roundtable event featuring Ricardo Luna, the Peruvian Minister of Foreign Relations. If Venezuelan law is applied, then the notes may well be deemed invalid and the noteholders will be stymied. All quotes delayed a minimum of 15 minutes. The Second Circuit was called upon to decide whether to apply the law of New York or the law of Venezuela to determine the validity of certain notes issued by a state-owned oil company in Venezuela. The decisions of the shareholder meeting are binding, within the limits of its powers, on the company. Item - SEC.gov | HOME The court first quoted the following language from the Prefatory Note to Article 8: [Article 8] deals with the mechanisms by which interests in securities are transferred, and the rights and duties of those who are involved in the transfer process. Although PDVSA is a state enterprise, it is expected to finance its normal investment program from its own resources, under a 10% cash flow mechanism whereby 10% of pre-tax export sales profits may be retained for the purpose of reinvestment by the company. The first oil company incorporated in the country was the Compaia Nacional Minera Petrlia del Tchira, formed on October 12, 1878. Interesting topic. All of this suggests that the applicable choice-of-law rule may not be the one laid down in Section 5-1401. Section 8-110 directs courts to apply the local law of the issuers jurisdictionhere, Venezuelato resolve issues relating to the validity of the security. The billion-dollar question is what exactly the word validity means in this context. With this goal in mind, between 1978 and 1987, the company decided to upgrade its refineries in Amuay, Cardn, and El Palito to reduce the proportion of residual fuels obtained in the refining process and increase the proportion of naphtha, gasoline and distillates. PDVSA Our goal is the efficient and transparent management of Venezuelan resources under rules that regulate our structure and operations and following professional and ethical principles to benefit the interests of Venezuela. It is understood to encompass the many reasons why a contract may not be enforceable as a matter of contract law. Major switching from oil to gas is not envisaged until 1992, after completion of the Nurgas pipeline from Anozategui to the West. PDVSA continues to invest in its production facilities with the intention of increasing production in a few years' time. Board of The Eleventh Circuit affirmed because the district court could not grant the motion without addressing a nonjusticiable political question. His partner Betancourt, is part of several ongoing criminal probes. Thousands of Venezuelans took to the streets across the country on Feb. 12 calling for international humanitarian aid to be allowed entry. On October 31, 1989, PDVSA acquired 50% of Unocal's downstream assets in the midwestern United States. Venezuelan businessman Luis Giusti Lugo, the son of a former PDVSA president, will replace CEO Jorda on the Citgo Petroleum board, while Ernesto Hernndez Bolvar will replace Pablo Prez on the same board, the statement said. Venezuela's move toward controlling its oil industry took a significant step in 1943, when the new hydrocarbon law integrated all oil legislation. 1155 15th StreetNW At meeting 2016-07 on May 2, 2016 the Board of Directors approved changes to the Executive Committee it is now composed of the president of Petrleos de Venezuela, S.A. as president of the committee, and the executive vice president and internal directors as members. F: +1-202-822-9553. How does PDVSA exercise its rights at Nynas? PDVSA 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 man provided a raw material for the syrups, which are linked to the deaths of more than 70 children in Gambia. If you believe there is an interest from the government to maintain PDVSA as a working entity, then this should be particularly beneficial for PDVSA bonds, but all money is fungible, so you never know if they redirect this money to other purposes. Tuesday's shakeup introduced five new appointees tied to different opposition parties, some of them the sons of former PDVSA executives. "Citgo continues working to improve profitability, control expenses and reduce costs in order to make the company an even better financial partner to our stakeholders and enable us to pay dividends to our shareholder as soon as we are financially and legally able to do so," the statement added. Unlike the 2017 Notes, the 2020 Notes were secured by a pledge of a 50.1% equity interest in CITGO Holding, Inc. (CITGO).