Venezuela-owned Citgo enters final stages of U.S. court-organized auction, risking loss of asset

From Yahoo Finance: 2025-06-16 07:08:00

A U.S. court-organized auction of Citgo Petroleum’s parent company, Venezuela-owned, enters final stages with bidders vying for the U.S. refiner to recover a portion of $19 billion owed to creditors. Contrarian Funds’ affiliate, Red Tree Investment, leads with a $3.7 billion bid, challenged by Vitol and others.

The auction, initiated by Canadian miner Crystallex against Venezuela, has seen delays but progressed with competing bids from companies like Vitol and a consortium including Gold Reserve. Elliott Investment Management’s affiliate, Amber Energy, considers joining. A court officer overseeing the auction must recommend a winner by July 2.

Venezuela, facing foreign debt of $150 billion, risks losing Citgo, its significant overseas asset, if it fails to retain equity. Delaware Judge leaves open the possibility for Venezuela to submit an offer, but U.S.-Venezuela strained relations make it challenging. Citgo’s ties with PDVSA were severed in 2019, affecting Venezuela’s oil market.

Creditors, including ConocoPhillips with $12 billion claims, have pursued legal action to seize Venezuela-owned assets. They can object to auction results and continue cases in other U.S. courts. Some creditors withdrew due to costs. Citgo’s weak performance may affect the auction’s outcome, leaving many creditors uncompensated.

Read more: Is Venezuela about to lose Citgo, its most prized foreign asset?