Venezuela’s State Oil Company PDVSA Faces Collapse; Creditors Fight over Assets
In less than a month, Venezuela’s state
oil company, Petróleos de Venezuela (PDVSA), faces three lawsuits that may end
up taking all of the oil giant’s international assets, leaving it bankrupt.According
to the economist and opposition congressman, Ángel Alvarado, the company that
20 years ago, was the second largest in the world, is about to disappear. Alvarado
says that the state has no way to pay all its outstanding debts or the legal
judgments that are looming. In an ominous sign, creditors today attempted to
collect USD $ 2.9 billion that the oil company has failed to pay in debt
obligations. The bankrupt company not only must face ConocoPhillips, after
having lost a lawsuit where it was ordered to pay the US oil company USD $2
billion; PDVSA now must also respond to a wave of similar claims, as it looks
for a way to pay bondholders after default, and tries to restart refineries
that are about to close because of diminished production caused by abandonment
and embezzlement. In short, PDVSA faces the perfect storm for falling into
bankruptcy, with no credible path for solvency. More…
In less than a month, Venezuela’s state
oil company, Petróleos de Venezuela (PDVSA), faces three lawsuits that may end
up taking all of the oil giant’s international assets, leaving it bankrupt.According
to the economist and opposition congressman, Ángel Alvarado, the company that
20 years ago, was the second largest in the world, is about to disappear. Alvarado
says that the state has no way to pay all its outstanding debts or the legal
judgments that are looming. In an ominous sign, creditors today attempted to
collect USD $ 2.9 billion that the oil company has failed to pay in debt
obligations. The bankrupt company not only must face ConocoPhillips, after
having lost a lawsuit where it was ordered to pay the US oil company USD $2
billion; PDVSA now must also respond to a wave of similar claims, as it looks
for a way to pay bondholders after default, and tries to restart refineries
that are about to close because of diminished production caused by abandonment
and embezzlement. In short, PDVSA faces the perfect storm for falling into
bankruptcy, with no credible path for solvency. More…
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