Citgo Reports Strong Profits and Makes Progress in Debt Reduction
Citgo reported a profit of $937 million during the first quarter of 2023, a 282% increase compared to the same period in 2022, as reported by the company in a press release.
The Venezuelan company in the United States attributed the result to “favorable refining margins and product yields, along with strong asset reliability.”
“The excellent financial and operational performance continued in the first quarter,” said Carlos Jordá, President and CEO of Citgo. “Additionally, we successfully completed a major turnaround at our Lake Charles refinery, and I especially congratulate them for increasing nominal capacity with professional ingenuity and minimal capital investment, while continuing to emphasize operational and commercial excellence throughout the company.”
The company noted that it refined 814,000 barrels per day (bpd) between January and March, and the Lake Charles refinery increased its nominal crude refining capacity by 38,000 bpd, from 425,000 bpd to 463,000 bpd, raising CITGO’s total nominal refining capacity to 807,000 bpd.
Citgo added that it “continued to diversify crude and product trading counterparts with customers in Canada, Egypt, India, Argentina, Chile, Brazil, Mexico, Portugal, Spain, and Oman. In addition, the Light Oils Marketing, Lubricants, Terminals, and Pipelines business units also delivered strong results in the first quarter.”
The day after reporting these results, the Venezuelan company announced a cash tender offer of $472.9 million for its 9.25% Senior Guaranteed Notes due 2024, a strategy it has been using to reduce its debt of over $4 billion inherited by the current administration.
Since 2019, Citgo is no longer under the administration of Nicolás Maduro’s government and is now controlled by the Ad Hoc Board of Directors of Pdvsa, appointed by the interim president, Juan Guaidó, and ratified by the National Assembly (2016) following the dissolution of the interim government.
Citgo faces multiple lawsuits in U.S. courts, including one related to the Pdvsa 2020 bonds, which are in default and half of which are guaranteed by the company’s shares. However, the most serious lawsuit is the one initiated by Crystallex, which resulted in the seizure of the company to settle compensation for the expropriation of its assets in Venezuela. At least eight other companies have joined this lawsuit, hoping for a similar compensation.
