Venezuela's opposition leader Juan Guaido and the national oil company's bondholders may participate in arguments next month over the future of the country's US refining assets, a US appellate court has decided.
The US Third Circuit of Court of Appeals will allow arguments from both parties as Venezuelan oil firm PdV seeks to overturn a key district court ruling that has allowed former Canadian mining firm Crystallex to seek shares of US independent refiner Citgo to satisfy an arbitration award against the country.
The arguments could determine the future ownership of Venezuela's most valuable overseas asset and open a new front in battles for legitimacy between National Assembly leader Guaido and President Nicolas Maduro's government.
The Third Circuit will next month hear arguments in Philadelphia over a district judge's decision last fall that Citgo functioned as an alter ego of the Venezuelan republic. The finding has allowed Crystallex, now controlled by New York-based Tenor Capital Management, to press a $1.4bn arbitration award for the expropriation of the company's Venezuelan mining interests.
Guaido intervened on behalf of the Venezuelan republic earlier this month, seeking a stay of the proceedings to allow his interim government time to review the case. Blackrock, an institutional bondholder, also intervened to argue that the court inappropriately allowed Venezuela's creditors to attach a US subsidiary.
US, Canada, and most of Latin America and Europe recognize Guaido as interim president of a transition government seeking Maduro's departure and new elections. Maduro has resisted these calls in the face of US sanctions imposed 28 January to cripple the country's oil production and imports.
The parallel governments have squared off more directly in another appellate case. Both Guaido and Venezuelan attorney general Reinaldo Munoz have argued to represent the country in arguments involving claims from a former Russian mining company.
The US extended into almost the end of 2020 a general license facilitating Citgo's continued operation as sanctions cut off most US business with Venezuela. The license does not exempt the 750,000 b/d complex refiner from naphtha export or crude import restrictions.
The Third Circuit scheduled oral arguments in the case for 15 April.
