February 18, 2005
PDVSA will keep Citgo, but will revise some accords

(BNamericas.com) - "Venezuela's state oil firm PDVSA has confirmed it will not sell its Citgo subsidiary in the US but will seek to extricate itself from refining joint ventures that it deems 'disastrous' to the national interest, energy and oil minister and PDVSA president Rafael Ramírez told reporters.

Ramírez said that an agreement between PDVSA and the Houston refinery Lyondell is particularly disadvantageous because PDVSA sells the refinery oil at a discount price. Talks to review the agreement have begun. Lyondell 'has given very bad numbers, disastrous. But we have an agreement, we have partners and we are talking to them,' Ramírez said.

The minister said PDVSA has received some offers from companies interested in buying its refineries in the US and Europe, but he dismissed reports of Citgo being sold wholesale. 'I want to reiterate that we will maintain a position in Citgo, we are revising some positions that are not convenient to us. There are refineries that don't refine a single barrel of Venezuelan crude and it is not viable sending our crude to some refineries because of the distance,' he said.

Citgo's tax structure would be revised so that the company pays taxes in Venezuela but not in the US, he added. Venezuela and the US have been negotiating an agreement to avoid double taxation for decades. 'It's not fast, we have been trying to sell German refinery Ruhr Oel for a year now', Ramírez said.

Through Citgo, PDVSA owns and/or operates with a partner six refining facilities and two asphalt plants in the US, where Citgo also operates 14,000 gas stations (...)".