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Dalinar Energy wins recommendation to acquire Citgo with $7.38bn bid

Dalinar Energy, a subsidiary of Gold Reserve, receives official recommendation from a US court to acquire PDV Holdings, the parent company of refiner Citgo Petroleum, with a $7.38bn bid, despite a higher competing offer from Vitol.

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The US court officer overseeing the auction of PDV Holdings, owner of US refiner Citgo Petroleum, recommends accepting the offer submitted by Dalinar Energy, a subsidiary of Canadian mining group Gold Reserve, amounting to $7.38 billion, Reuters reported on July 3.

Higher competing offer

According to two sources cited by Reuters on July 2, another bid, exceeding $10 billion, had been submitted by a consortium led by Swiss commodities trading company Vitol during the final hours preceding the auction’s close. The court, however, chose to prioritise Dalinar Energy’s offer after reviewing the competing proposals.

The auction procedure was organised under the legal framework established in the United States to manage foreign assets involved in financial disputes. PDV Holdings, Citgo Petroleum’s parent company, currently belongs to the Venezuelan national oil company Petróleos de Venezuela SA (PDVSA).

Consequences for the oil market

The final decision regarding the definitive approval of the sale must still be formally validated by the court before the agreement becomes definitive and enforceable. Citgo Petroleum is considered a strategic asset, operating three major refineries located in Texas, Louisiana, and Illinois, representing a total refining capacity of approximately 769,000 barrels per day.

Significant for international oil market participants, this potential acquisition involves important considerations regarding US energy interests and international economic relations. Dalinar Energy, a subsidiary of Gold Reserve, confirmed this judicial recommendation through an official statement but declined any further comment at this stage.

Economic impact and international context

The judicial sale process has been closely monitored by international oil markets, in an economic context marked by volatility in commodity prices. The selection of an offer significantly lower than that of the Vitol group notably attracted attention from specialised observers.

Founded in 1910 and operating throughout US territory, Citgo Petroleum is one of the leading players in the US refining sector. Its sale constitutes a major transaction in the North American market, closely followed by investors and commodity specialists.

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