$10 billion Citgo auction could finally end twisting saga of Venezeulan expropriation, imprisoned execs, and a long-shot NYC mayoral candidate | Fortune

"The bidders do not include the usual suspects, such as Big Oil giant Exxon Mobil or major refiner Phillips 66. Instead the finalists are activist investor group Elliott Investment Management, Canada-listed miner Gold Reserve, and an upstart special-purpose acquisition company named Blue Water. The latter is led by a biotech investor and a long-shot New York mayoral candidate pledging to take Citgo public."

"The biggest companies likely stayed out of the bidding because of all the legal and geopolitical complications, energy analysts said, especially since Venezuela and state oil company PDVSA still lay claim to Citgo from what they regard as a sham legal process in an enemy nation's courtroom in Delaware. "Citgo could become a new, publicly traded refiner or it could be broken into pieces," said Alan Gelder, vice president of refining, chemicals, and oil markets for the Wood Mackenzie energy research firm. "It's very hard to say what form it will take and whether it's going to be a poisoned chalice for the winner.""

"After all, the saga involves asset seizures, the arrest and imprisonment of Citgo executives in Venezuela, prisoner exchanges, and multiple auction rounds in a bizarre, winding legal process. The refining assets could require expensive maintenance upgrades after several years of legal purgatory, Gelder said. Creditors seeking to recoup nearly $20 billion in claims from Venezuela regard Citgo as their crown jewel. But none of the bids exceed $10 billion in the court-ordered legal pr"

Citgo Petroleum is a U.S. refiner founded 115 years ago and owned by Venezuela since 1990. A decade-long legal saga may end with a court-ordered auction to satisfy creditors whose oil, mining and other assets were expropriated under Hugo Chavez. Finalist bidders include Elliott Investment Management, Canada-listed Gold Reserve, and Blue Water, a SPAC led by a biotech investor and mayoral hopeful pledging to take Citgo public. Major oil companies stayed away because of legal and geopolitical complications and Venezuela/PDVSA continue to claim Citgo. Potential outcomes include a public refiner, asset break-up, or costly maintenance and upgrades while bids remain below creditors' nearly $20 billion claims.

Read at Fortune