Chavez cousin to lead Citgo, PDVSA's arm in US

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November 23, 2017 2:51 AM

Venezuelan President Nicolas Maduro on Wednesday named Asdrubal Chavez -- a cousin of late leader Hugo Chavez -- to lead Citgo, the state oil companys US affiliate.

"He's straight off to be Citgo president, to restructure it, to get it back, to strengthen Citgo," Maduro said in a speech broadcast on VTV state television.

Asdrubal Chavez held the critical oil ministry portfolio from 2014-2015.

Venezuela on Tuesday arrested the acting president and five other top executives in charge of Citgo, the US refinery subsidiary of troubled state oil company PDVSA, on corruption charges.

Their arrests come just a week after the detention of a deputy minister and nine PDVSA officials for allegedly doctoring crude oil production figures.

Oil sales generate 96 percent of Venezuela's hard currency earnings.

In all, around 50 PDVSA employees have been arrested under an anti-corruption drive led by new attorney general Tarek William Saab since he took office in August.

The sweep underlines the debt woes swirling around PDVSA, which is the prime source of income for Venezuela, a country that sits atop the world's biggest oil reserves.

Both PDVSA and Venezuela are staring down the barrel of default on a debt pile estimated at up to $150 billion, around a third of which is paper issued by the oil company.

A partial default has already been declared by major credit ratings agencies, and an influential creditors' committee has ruled that PDVSA failed to make payments on time.

That is setting the scene for all holders of Venezuela government and PDVSA debt to possibly call in their IOUs at once -- an impossible situation for Caracas, which has less than $10 billion in hard currency reserves left.

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