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Citgo to Resume Refurbishing Aruba Refinery Next Month

Reuters, August 16, 2018
Reuters

A unit of Citgo Petroleum in September plans to resume long-delayed work to refurbish an idled, 235,000-barrel-per-day (bpd) oil refinery on Aruba, the Caribbean island’s government said on Wednesday. Due to a lack of credit, Citgo Aruba Refining in February had slowed efforts at the plant amid U.S. financial sanctions imposed since 2017 on its parent company, Petroleos de Venezuela (PDVSA).

Under a $685-million project that was approved in 2016 by Aruba’s government in a 25-year lease contract, Citgo aims to revamp and restart a facility that has been idled since 2012 when the previous operator, U.S.-based Valero Energy, halted crude processing due to low profits. Citgo declined to comment.

PDVSA and its subsidiaries are increasingly under pressure to gain access to a Caribbean terminal or a refinery since U.S. producer ConocoPhillips in May began seizing the company’s overseas assets to satisfy a $2 billion arbitration award.

The project’s latest phase will require about $35 million in investment and will take eight to 10 months to be completed, Aruba’s Labor Ministry said in a statement. Some 150 additional workers will be hired for the task.

The total number of workers, mostly local, is now reaching 500 people ... Financing for this stage is already available,” Aruba’s Labor Minister Glenbert Croes said.

The plan was submitted by Citgo to the government of Aruba earlier this week, according to three sources with knowledge of the talks. Citgo appointed new executives for its Aruba unit in June in preparation for the new stage of the refurbish plan.


(Reporting by Sailu Urribarri in Jacksonville; Writing by Marianna Parraga; Editing by G Crosse)

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