CARACAS (Various sources), 1st October 2019 – With less than three weeks to go for the PDVSA 2020 payment on 27th October 2019, Reuters reported that Guaido’s administration is considering challenging the legality of the issuance of the bond backed by 50.1% of CITGO’s shares due to the lack of National Assembly approval for the usage of collateral, which would constitute a “national public interest contract” (you can read more here).

On the other hand, a group of senators and congressmen in the US penned a letter asking the administration of Donald Trump to protect CITGO from being seized by the PDVSA 2020 bondholders in the event of a default by the end of the month. Previous reports have mentioned that Guaido’s interim government was lobbying to get an executive order to block any transfer of CITGO’s share. The letter authored by the congressmen can be read here (you can read the full story here).

Finally, Rosneft officials said that a default on PDVSA 2020 bond won’t lead to the transfer of control of CITGO to the Russian oil company, according to comments published by Russian news agency TASS. Rosneft officials mentioned that they were not interested in managing CITGO, and that they’ve always seen the CITGO lien as “a liquid collateral for the prepayments made to PDVSA”

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