Citgo Posts $25 Million Q2 Loss Amid Unfavorable Market Conditions, Refinery Maintenance
(Reuters) — U.S. oil refiner Citgo Petroleum on Thursday reported a net loss of $25 million in the second quarter following unfavorable market conditions and refinery maintenance and upgrades, compared with income of $410 million in the quarter immediately prior.
A U.S. federal court is auctioning shares of one of the parents of the Venezuela-owned company, which is the seventh- largest U.S. refiner, in order to pay up to $21.3 billion in claims from debt defaults and expropriations in the South American country.
Citgo's crude processing fell to 678,000 bpd with an average crude utilization of 84% due to turnaround and maintenance activities, compared with crude runs of 769,000 bpd and utilization of 95% in the previous quarter.
Citgo had net income of $2 billion last year.
"Our second quarter earnings reflect a lower margin environment and the impact of extensive turnaround and maintenance activities at our refineries," Citgo Chief Executive Carlos Jorda said in a release.
Citgo's 463,000-bpd refinery in Lake Charles, Louisiana, underwent works to improve utilization of certain units, while the company's other two refineries, the 177,000-bpd facility in Lemont, Illinois, and the 167,000-bpd one in Corpus Christi, Texas, optimized heavy crude processing.
The company has dedicated about $1 billion so far this year to capital expenditures, turnarounds and catalysts, it said.
Quarter-end liquidity fell to $3.8 billion from $4.5 billion at the end of the first quarter, a key metric companies participating in the court-organized auction of shares have been monitoring to calculate their bids.
Marketing sales volume rose to 424,000 bpd in the second quarter, from 394,000 bpd the previous quarter, the largest quarterly increase in branded sites in the last two decades.
The company reported an unbranded gasoline sales record in June and new jet fuel sales contracts signed.
U.S. refiner CVR Energy, backed by activist investor Carl Icahn, and a group of creditors holding claims against Venezuela are competing in the last mile of the auction for Citgo's parent, sources told Reuters earlier this month.
By Aug. 22, a winner must be selected by a court officer overseeing the auction in Delaware, while Oct. 30 was set for the sales process' final hearing.
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