U.S.
oil company ConocoPhillips has brought new court actions to seize two
cargoes of crude and fuel near a terminal operated by PDVSA subsidiary
Citgo Petroleum in Aruba, the Aruban government confirmed on Tuesday.
Conoco is moving aggressively to enforce a $2 billion
arbitration award over the 2007 expropriation of two oil projects in
Venezuela, creating unease in the Caribbean, where many islands depend
on fuel produced by state-run PDVSA.
“The Aruba refinery has said that an embargo on two Citgo oil
cargoes was introduced last night. Citgo is claiming the crude as its
own, and is fighting at court to demonstrate the product is not PDVSA’s,” said Prime Minister Evelyn Wever-Croes in a statement. “Independent of any outcome, this is not going to affect Aruba,” she said.
The cargoes seized included 500,000 barrels of crude oil on the Grimstad and about 300,000 barrels of jet fuel, gasoline and diesel on the Atlantic Lily, according to a source at the Aruba terminal and Thomson Reuters vessel tracking data.
Citgo, the U.S. refining unit of PDVSA, has leased the 209,000
barrel-per-day (bpd) Aruba refinery and its 13 million-barrel terminal
from the government since 2016 to store Venezuelan and other crudes for
supplying its U.S. refineries.
As the refinery remains idled since 2012 while a major refurbish
project is underway, Citgo regularly supplies the island with imported
fuel.
Wever-Croes told journalists government officials and the management
of the refinery were organizing a contingency plan to avoid a situation
similar to Curacao and Bonaire, where inventories were blocked by
Conoco’s legal actions.
No fuel shortages have been reported in the Caribbean but officials are trying to import from other sources.
Conoco in recent days seized the 10-million-barrel BOPEC oil terminal
owned by PDVSA in Bonaire and fuel inventories at the 335,000-bpd Isla
refinery operated by the Venezuelan firm in Curacao. Both islands are in
talks with Conoco to free fuel for domestic consumption.
“What belongs to Citgo belongs to PDVSA, but a judge has to rule on it,” Wever-Croes said.
Daren Beaudo, a Conoco spokesman, said on Tuesday that the
company sent representatives to the Caribbean this week to meet with
local officials and address their concerns over Conoco’s efforts to
enforce the arbitration award by the International Chamber of Commerce
(ICC).
PDVSA did not immediately respond to a request for comment.
Last week, Curacao officials said the Isla refinery would have to
halt refining operations once its available inventories were exhausted.
“It is PDVSA that has failed to honor our award by ignoring the judgement of the ICC tribunal and other local court orders,” Beaudo said in a statement.
Conoco Chief Executive Ryan Lance on Tuesday said the firm is far
from recovering all of the $2 billion ICC award. He said legal actions
have been brought in Hong Kong and London to have the ruling recognized
following a similar move last month in a New York court.
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