CITGO logo on a gas station in the US. Photo: Mike Mozart/Flickr (CC BY 2.0).
The hearing to conclude the protracted and controversial sale of the Venezuelan refiner is set to finally begin on September 15.
Caracas, September 1, 2025 (venezuelanalysis.com) – Vulture fund Elliott Management has emerged as the frontrunner to acquire US-based Venezuelan refiner CITGO as part of a long-running, court-mandated process to sell the country’s most important foreign asset.
Delaware court-appointed “Special Master” Robert B. Pincus has recommended the US $8 billion offer from Elliott subsidiary Amber Energy as the strongest bid in the ongoing sale of Venezuela’s US-based oil subsidiary.
The hearing to conclude the auction is scheduled to begin on September 15.
In 2022, Delaware District Judge Leonard P. Stark set in motion a forced sale of shares belonging to PDV Holding (PDVH), a subsidiary of Venezuela’s state oil company PDVSA and CITGO’s parent company. The auction was designed to address a number of creditor claims against Venezuela, mostly stemming from international arbitration awards concerning assets nationalized by the Hugo Chávez government in the 2000s.
In July, Pincus had endorsed a $7.4 billion offer from Dalinar Energy Corporation, a subsidiary of Canadian miner Gold Reserve, itself a creditor in the CITGO proceedings.
However, the process was thrown into renewed uncertainty with the arrival of new bids from Elliott and trading giant Vitol. Pincus ultimately requested a postponement of the final sale hearing and switched his recommendation to Amber.
Gold Reserve raised its offer by $500 million to $7.9 billion, but the Delaware court official stuck with his choice of Elliot’s affiliate. Despite the similar proposal values, the special master was ultimately swayed by Amber’s greater certainty of closing.
Amber had originally been selected by Pincus in September 2024 with a $7.3 billion bid, but controversy over sale terms saw Stark order the process restarted.
The recommended bid includes $2.1 billion set aside for a settlement with holders of the defaulted PDVSA 2020 bond, for which half of CITGO was pledged as collateral. Though the legality of the debt instrument is undergoing litigation, PDVSA 2020 bondholders represented a potential risk for concluding the CITGO sale.
“Faced with these choices, the Special Master concludes that the Amber sale transaction is the best bid for the PDVH shares,” Pincus concluded, stressing that the Dalinar rival bid “may not be able to close and may require re-solicitation of bids at a significantly depressed level.”
For its part, Gold Reserve has pledged to “vigorously object” to the final recommendation. The company contends that Amber Energy’s bid, with the PDVSA 2020 settlement set aside, is nearly $2 billion lower than its own, leading to fewer claims being fulfilled.
Gold Reserve claimed to have secured increased financing support to ensure “flexibility” to handle the potential liability posed by the PDVSA 2020 bondholders. “Dalinar Energy is assuming the risk associated with the 2020 bondholders’ claims in its proposal,” the statement read.
Parties have until September 6 to file objections to be considered by the court.
The Delaware auction proceeds will pay creditors on a “first come, first served” basis, with Crystallex ($1.0 billion), Tidewater ($80 million), ConocoPhillips ($1.3 billion) and O-I Glass ($700 million) first on the list. The process was initiated by Canadian miner Crystallex thanks to an “alter ego” ruling which made PDVSA liable for Venezuela’s debts.
With CITGO under the management of the US-backed opposition, subsequent alter ego verdicts saw other corporations tag claims to the proceedings. Former self-proclaimed “interim president” Juan Guaidó and associates drew accusations of malfeasance and conflicts of interest that ballooned the company’s liabilities to $20.6 billion.
CITGO’s looming change of ownership is subject to the US government’s approval, though the US Treasury has promised a “favorable licensing policy.”
Caracas has labeled the court-led sale of the Caribbean country’s most valuable foreign asset as “the theft of the century” and vowed to challenge the loss of the Houston-based refiner.
Valued at around $13 billion, CITGO owns refineries in Illinois, Louisiana and Texas with a combined processing capacity of 769,000 barrels per day (bpd). The company’s portfolio also includes a pipeline network and over 4,000 service stations, mostly on the US East Coast.
(Venezuelanalysis.com) by Ricardo Vaz
