CITGO confirms that the Gerd Knutsen and its crew have safely reached international waters, and that the Company intends to pursue the Maduro regime, and any entities that may have assisted it, for unlawful seizure of its cargo.
BACKGROUND ON CITGO GERD KNUTSEN SEIZURE:
CITGO Petroleum Corporation (CITGO) learned that at approximately 6 am Central Time on Feb. 9, 2020, naval forces and other members of the Maduro regime boarded the Gerd Knutsen, owned by Knutsen NYK Offshore Tankers , as the vessel sat at anchor nine miles off the Venezuelan Port of Guiria. The Gerd Knutsen was fully loaded with 960,000 barrels of crude oil, to which CITGO had legal title and was the rightful owner. With this threat of force, the Maduro regime directed the vessel to sail to another Venezuelan port and discharge CITGO’s property to the regime for its own use.
As part of its normal course of business, CITGO regularly chartered ships to transport crude and refined products to and from Venezuela. After the United States imposed sanctions on Venezuela and Petróleos de Venezuela, S.A. (PDVSA) on Jan. 28, 2019, no outward clearance documents were issued by the local harbor masterdespite repeated requests. In August 2019, the rightful Attorney General of Venezuela directed that the cargo belonged to CITGO and that local authorities should clear the vessel to depart. Nevertheless, the Gerd did not depart per CITGO’s instruction. The vessel has remained unmolested in Venezuelan waters for more than a year, during which time CITGO repeatedly directed the Gerd to deliver its cargo to CITGO.
The Maduro regime, including through its control of PDVSA in Venezuela, has previously attempted to obtain the cargo from the vessel. The regime tried to instruct the ship directly though it had no right to do so; it impersonated the CITGO board of directors and presented a fictitious board resolution authorizing release of the crude to CITGO, an effort that was defeated by a Delaware court; and finally it obtained an order from a Venezuelan criminal court threatening the captain of the ship with criminal penalties, including potentially jail.
Despite CITGO’s repeated efforts to resolve the issue, the vessel was never cleared to depart until the Maduro regime escalated hostilities with its recent action towards the vessel, which resulted in the vessel forcibly escorted by a military vessel, the Cormoran, to the JoseTerminal near Puerto La Cruz so that the regime could unload and take possession of CITGO’s cargo. Notwithstanding the regime’s recent hostilities, we are relieved to report that the Gerd and its crew have been able to safely return to international waters.
CITGO Petroleum Corporation will continue to pursue all efforts to collect on losses that it incurred because of theunlawful seizure of its cargo by the Maduro regime and any entities that may have assisted it.