November 27, 2015 / 10:40 PM / 3 years ago

Venezuela's PDVSA says Crystallex $2.8 bln claim unfounded

CARACAS, Nov 27 (Reuters) - Venezuela’s PDVSA said on Friday that Canadian miner Crystallex had no justification for a complaint in a U.S. court seeking to recover $2.8 billion from the state oil company.

Crystallex filed the complaint Monday in Delaware, saying PDVSA and its U.S.-based refining unit Citgo Holding designed a refinancing deal to lower Citgo’s value and dissuade asset seizures stemming from arbitration awards.

Crystallex is engaged in a $3.1 billion arbitration claim against Venezuela before an international tribunal over the termination of its Las Cristinas gold asset in Venezuela.

“Once the official notification of this claim is received, if it even exists, PDVSA will respond appropriately, given there is no basis or foundation whatsoever for a claim by Crystallex against the national oil company,” PDVSA president and Oil Minister Eulogio Del Pino said.

The statement said PDVSA was once again the target of “a ferocious international media campaign” aimed at undermining the ruling Socialist government before a Dec. 6 vote for a new National Assembly in the South American OPEC nation.

Citgo Holding this year issued bonds and loans worth around $2.8 billion, with dividends distributed to headquarters in Venezuela, which is suffering a recession and has been hurt by sliding oil prices.

The debt, Crystallex said in the complaint, was designed to leave Citgo insolvent on an accounting basis just as arbitration cases are coming to fruition.

“Through PDVSA and its subsidiaries, Venezuela sought to monetize its interests in (Citgo) and repatriate those proceeds, thereby shielding them from attempts to enforce any arbitral award,” Crystallex said in the filing.

“Crystallex is therefore entitled to money damages in the amount of $2.8 billion or the final amount of its arbitration award against Venezuela, whichever is lower.”

Dozens of companies have sought compensation after their projects were taken over under late leftist president Hugo Chavez, who led a wave of nationalizations during his 1999-2013 rule that included the oil, electricity and steel industries.

Del Pino gave no further comments or information on the Crystallex case in the statement from PDVSA. (Writing by Andrew Cawthorne; Editing by Andrew Hay)

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