President Chavez wants to sell Citgo "because it is a bad deal and it is better to have money in a bank" (sic) Look at the history. In 1986, PDVSA purchased 50% of Citgo for $ 290 million to be paid $ 100 million in cash and $ 190 million promissory note was canceled by a reduction in crude oil to be sold Citgo to pay the debt with the difference between discounted price and the market price of oil. Citgo bought cheap (worth $ 400 million) because in that year the oil market was vendors and refineries did not have security of supply. In 1989 it acquired the remaining 50% of Citgo for $ 650 million (it was another market) share paid by our oil inventories in the U.S. and partly funded. Then the capital of the company had increased by $ 300 million. Citgo 24 years has invested, some to adapt the configuration of its refineries and to process heavy crudes. More to comply with environmental regulations. All were made with cash flow from Citgo. PDVSA did not provide a single dollar.
Why PDVSA acquired Citgo? Let's see: The big oil companies are vertically integrated. Are present in exploration, production, refining (in their countries and in major markets consumption), transportation, commercialization and marketing. In 1986, PDVSA had difficulty placing its heavy crude because many refineries were not designed to process and had an oversupply of light crude. To ensure that market fluctuations do not adversely affect our offer and guarantee to refine heavy crude oil, Citgo was acquired. It was a strategic investment to ensure captive customers in the world's largest market and trade, because the low acquisition price guarantee, through the years, in the unlikely event that a sell (in 1986 no one anticipated Chavez) price would be much higher than that paid, which would ratify the good investment was. Indeed, if in 1986 and in 1989 PDVSA paid a total of $ 940 million and if Chavez thinks that what remains of Citgo worth $ 10,000 million (already sold 50% stake in the refinery Lyontell and other properties) that means performance than initially paid to sell, would be 10% per annum (compound interest). No bank pays interest on those dollars. The U.S. treasury bonds paying 4.35% per annum, they have been purchased with the $ 940 million it cost to Citgo, its current value would be $ 2,700 million. If Citgo throws now lost is being poorly managed. So the president must consult with Merentes, a man of numbers, before releasing crap like that.
all know that Chávez needs money for his presidential campaign, therefore, wants to sell an asset like Citgo. Afraid that PDVSA lost pending arbitrations with Exxon Mobil, Conoco Philips and other demands and seize any Citgo to collect. In addition, the low country's oil production and sales absurd maula countries PDVSA has to buy oil from other producers at market prices, to supply Citgo. Then I suspect that reports these volumes bought from third parties own production. Mr. Chávez, in oil you can deceive faithful followers but those who know the industry, they are not, of course, those who now run PDVSA can not convince us with their few professionals improvisations.
No sir!
alberto_quiros@intercon.net.ve 
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