Congressman urges Obama to block Venezuela's Citgo sale

MIAMI Wed Aug 27, 2014 7:18pm EDT

U.S. Congressman Joe Garcia speaks out against Venezuela's plan to sell the U.S. refining-and-retail unit of its state-owned oil company at his district office in West Kendall, Florida August 27, 2014. REUTERS/Zachary Fagenson

U.S. Congressman Joe Garcia speaks out against Venezuela's plan to sell the U.S. refining-and-retail unit of its state-owned oil company at his district office in West Kendall, Florida August 27, 2014.

Credit: Reuters/Zachary Fagenson

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MIAMI (Reuters) - A U.S. congressman urged the Obama administration on Wednesday to block the proposed sale by Venezuela's state oil company of its North American refining unit Citgo, saying it would be against "vital national interests".

Venezuela Oil Minister Rafael Ramirez said earlier this month that the country aims to exit Citgo "as soon as we receive a proposal that serves our interests."

Citgo [PDVSAC.UL] has three U.S. refineries in Illinois, Louisiana and Texas with combined capacity of some 750,000 barrels per day, and it also has 48 terminals.

Flanked by Venezuelan opposition figures, U.S. Representative Joe Garcia said the proposed sale by Venezuela's socialist-led government was "a huge concern."

The value of Citgo, he said, was derived from the refiner's links to Venezuela's state oil company PDVSA [PDVSA.UL] and the OPEC nation's crude oil reserves, which are the biggest in the world.

"It is one of the last assets that the Venezuelans have had and have not been able to damage its value," the Democratic congressman told a news conference in Miami.

"We believe that allowing this government to monetize this part of the Venezuelan patrimony would be a grave mistake."

China displaced the United States as the top destination for Venezuelan oil in 2013, and PDVSA's cash flow has been crimped as much of the oil is used to service loans from Beijing.

PDVSA is working with investment bank Lazard Ltd to sell Citgo, according to people familiar with the situation.

Garcia, whose district includes most of western Miami-Dade County and the Florida Keys, said U.S. companies were owed large amounts of money by Venezuela's government, which nationalized most of its oil industry under the late President Hugo Chavez.

"We don't want a grab bag with a regime that has thus far destroyed everything it's touched," Garcia said.

"I am not about to let them dissipate national assets for one more piƱata among thugs. It's just not acceptable. ... The last thing we want them to do is to delink themselves from the U.S. and to not pay its debtors."

Garcia's constituents include many Venezuelan exiles who left home during Chavez's controversial time in office.

Accusing Venezuelan officials of committing abuses in a crackdown on protests against President Nicolas Maduro that began this spring, Washington has barred some government ministers and presidential advisers from entering the United States.

Members of the U.S. Congress, particularly Republicans and Florida lawmakers, have also called for the freezing of U.S. financial assets of Venezuelans considered to be rights abusers.

(Reporting by Zachary Fagenson; Writing by Daniel Wallis; Editing by Ken Wills)

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Comments (2)
morbas wrote:
Separation of Corporation and State is in the interests of the people. Corporations are oligarch organizations, contrary to Democracy. Likewise, we should not tax corporations as this leads to manipulation of peoples rights, an unfair burdening of the means of the lower 4/5th quin-tiles (gregariously amend this to ‘of the lower 99.9%’ ).
As the congressional election date nears, we the people having ONLY the ballot to control and direct our representation, MUST mandate tax code revision and a separation of corporate and state. Restatement of the Revenue ( Income ) Tax Act of 1913 using a progressive tax rate that integrates income produces rate the same at every income and progressive rates for the higher income moneys. And does not tax business. This alloted in 1/3rds to Federal, State and Local levels (per capita proportioned) would balance all government budgets.
The first $100k of the multimillion incomes taxed at the same rate for $100k incomes. The tax rate at 90% at $1Million results in a less than %50 effective tax rate.

As the congressional election date nears, we the people having ONLY the ballot to control and direct our representation, MUST mandate tax code revision and separation of corporate and state.
morbas(i)

Aug 28, 2014 7:48am EDT  --  Report as abuse
Chris_Cummins wrote:
Thank you Congressman Garcia for working at many of the economic issues that our country faces.

Aug 28, 2014 3:06pm EDT  --  Report as abuse
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