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MENE GRANDE, Venezuela, Aug 5 (Reuters) - Venezuelan state oil company PDVSA will sell North American unit Citgo Petroleum if it receives a good offer, Petroleum Minister Rafael Ramirez told reporters on Tuesday in what would be its biggest pullback ever from the U.S. refining market.
Citgo has three U.S. refineries with combined capacity of some 750,000 barrels per day. They are in Lemont, Illinois, Lake Charles, Louisiana, and Corpus Christi, Texas.
“As soon as we receive a proposal that serves our interests, we will exit Citgo,” Ramirez said during a celebration of the 100th anniversary of Venezuela’s oil production. “This is not something simple like deciding to take off a jacket, this is an issue that we’re working on.”
China displaced the United States as the top destination for Venezuelan oil in 2013 and PDVSA’s cashflow has been crimped as much of the oil is used to service loans from Beijing.
It may be difficult to find a single buyer for all of Citgo’s assets as two of the refineries are geared to run heavy crudes from Venezuela and U.S. refining companies are trying to maximize profits by buying cheap domestic light crudes, refinery experts said.
Analysts added that Lemont, the only Citgo refinery that does not process Venezuelan heavy crudes, may be the easiest to sell because of its location in proximity to inexpensive Canadian crudes.
Citgo also owns a network of terminals and pipelines that would be highly attractive as demand for energy infrastructure rises on surging output of domestic crudes.
Separate from Citgo, PDVSA has a stake in the Chalmette refinery in Louisiana with Exxon Mobil. The Venezuelan company also owns the Merey Sweeny unit of the Sweeny, Texas, refinery with Phillips66, which was spun off from ConocoPhillips.
Ramirez did not directly address the possible sale of PDVSA’s other refining assets in the United States, although bankers have said Chalmette is for sale.
But selling it or Merey Sweeny would likely lead to legal tangles because of arbitration claims filed by Exxon Mobil and ConocoPhillips over 2007 nationalizations of their projects in Venezuela.
The two companies are seeking billions of dollars in compensation through the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) and the International Chamber of Commerce (ICC).
To ensure they are compensated, the companies could ask courts to block the sale of PDVSA’s stakes in Chalmette or Merey Sweeny.
Ramirez said oil deliveries to the United States would be unaffected.
“We are not a refining company, we are a business that produces oil,” he said. “We will always maintain supply contracts, we are not going to pull out of our markets.”
He also denied PDVSA is looking to raise cash.
“It’s not that we’re looking for fiscal revenue, as some analysts say. We are fine with our fiscal revenue from oil. What we need is to stop wasting fuel,” he said. (Reporting by Deisy Buitrago, writing by Brian Ellsworth; Editing by David Gregorio, Terry Wade and Gunna Dickson)