US sanctions pull plug on Citgo Aruba project

A $1.1bn Venezuelan project to refurbish a mothballed refinery on the Dutch-controlled island of Aruba has derailed because of US sanctions on national oil company PdV.

PdV's US refining unit Citgo can still use the storage terminal, however, so long as the crude does not belong to PdV. Citgo signed a 15-year lease for Valero´s former 235,000 b/d refinery and terminal in 2016 with a plan to transform the refinery into a heavy crude upgrader.

The upgrader project had already been lagging timelines and funding targets, causing considerable frustration in the government of the tiny island that is better known for its beaches than its refinery.

Citgo Aruba today laid off 100 of around 250 contract employees in the project, because the sanctions prohibit funding of parent company Citgo Aruba Holding, according to a source close to the island´s government.

If by the end of March the funding is still blocked, the Citgo refinery and terminal units will need to reduce their workforce from 142 to 85 people, and the number of contracted employees will fall from 120 to 70, according to an internal memorandum obtained by Argus.

Phase 2 of the project, involving detailed inspection of the aging infrastructure, got underway in September 2018 and is now stopped. The final refurbishment phase was supposed to kick off in the second quarter of 2019.

Before the US imposed the oil sanctions on 28 January, Citgo had been regularly using Aruba as a terminal, routinely unloading Venezuelan diluted crude oil (DCO) and other grades into storage tanks to allow it to settle and drain out excess water before reloading it for export to the US and Asia. But PdV´s crude production and exports are falling in response to the sanctions, which have effectively cut off the US market and are discouraging some non-US buyers to look elsewhere.

The US sanctions are aimed at unseating Nicolas Maduro, whom the US, Canada and most EU and Latin American countries no longer recognize as president. The emerging administration of self-proclaimed acting president Juan Guaidó yesterday named a new board of Citgo in a bid to block the asset´s takeover from Venezuela´s multiple creditors.

News No: 3659
Date: 2019/02/17 - 21:36
News Source: Argus Media

US sanctions  Citgo Aruba project  Venezuelan  PdV 


Leave a Comment:


Diplomat: Royal Mail Service to Iran Re-Established

Iranian Ambassador to London Hamid Baeidinejad announced that Britain’s top posting service company the Royal Mail has restored its operations to the destination of Iran.

Iran’s Exports of Petrochemicals Up by 18%

The total amount of Iran’s petrochemical exports in the first Iranian month of Farvardin (March 21 – April 20) increased by 18 percent compared to the same period last year despite the US sanctions, data released by the Customs Office showed.

S. Korea's Oil Imports from Iran Rise in April

South Korea’s Iranian oil imports rose 17% in April from a year earlier, customs data showed on Wednesday.

South Korean Oil Imports From Iran Jumped 17% in April

South Korea imported 353,000 barrel per day of Iranian crude last month, up 17% on March ahead of the removal of sanction waivers that granted South Korea and another seven countries to legally import certain amounts of Iranian crude despite US sanctions.

US Oil Prices Up 50%

Venezuela is in chaos. Iran is grappling with US sanctions. And now there is a surge of violence in Libya. Trouble in these three OPEC nations has helped send US oil prices climbing back above $64 a barrel.

India Delays May Order for Iran Oil

Indian refiners are holding back from ordering Iranian oil for loading in May pending clarity on whether Washington will extend a waiver from US sanctions against the OPEC-member, four sources said.
Upcoming Events
 Mines & Metals

Mine & Business Today

 Scrap & Recycling


Our partners