May 27, 2019 / 5:06 PM / 4 months ago

Aruba to form committee to decide fate of idled refinery: prime minister

(Reuters) - The government of Aruba said on Monday it will form an advisory committee to decide the future of a 209,000-barrel-per-day refinery that remains idled amid sanctions on operator Citgo Petroleum’s parent company, Petroleos de Venezuela (PDVSA).

Prime Minister Evelyn Wever-Croes said there are three possible scenarios for the Aruba refinery: to continue working with Citgo on an overhaul, to negotiate a Citgo contract termination and continue with the plant, or to use the facility for a different activity.

The committee should issue recommendations within two months of its formation, Wever-Croes said in a publicly broadcast message. Its members have yet to be announced.

“Very possibly, we will not continue (working) with Citgo, but that is being evaluated, how to leave the contract without problems,” she said.

A Citgo spokeswoman did not immediately reply to requests for comment.

Citgo and Aruba in 2016 agreed to a 25-year contract to refurbish and reopen the facility, which has remained idled since 2012, when its former operator, U.S.-based Valero Energy Corp, abandoned it over low profits.

The $685 million overhaul, which had received initial funding from Citgo and PDVSA, had shown little progress since Washington in August 2017 issued a first round of sanctions on the Venezuelan state-run oil company. In late January, a second round of sanctions left the refinery without access to credit.

In February, Wever-Croes said her government was in talks with the United States to look for solutions to the inactivity of the refurbishing project, aimed at converting the refinery into a heavy crude upgrader.

Reporting by Sailu Urribarri in Jacksonville, Fla.; Writing by Marianna Parraga; Editing by Matthew Lewis

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