Venezuelan state oil company announces payments on certain bonds

Caracas (AFP) –


Struggling Venezuelan state oil company PDVSA says it has begun paying $539 million in interest payments on four bonds hours before a grace period expires.

The company, source of 96 percent of the country's foreign revenues, was declared in partial default by global rating agencies earlier this month and in November when it failed to make payments on certain bonds.

It informed bondholders in a statement on Twitter that on Thursday it began "the transfer process" for the payment of PDVSA bonds maturing in 2026, 2024, 2021 and 2035.

The grace period for making those payments runs out between Friday and Sunday.

"We ratify the solvency and solidity of our oil industry, in a struggle against the illegal imperial sanctions," it said.

The company was referring to sanctions imposed by the United States that bar US persons from engaging in transactions involving new Venezuelan debt.

President Nicolas Maduro's leftist government says the sanctions are causing the delays in debt payments.

PDVSA's debt accounts for about 30 percent of the country's estimated $150 billion foreign debt, which Maduro is seeking to refinance.

Although it has the world's largest oil reserves, Venezuela's hard currency reserves have dwindled to about $10 billion and it must pay out eight billion to service its debt in 2018.

Once one of the wealthiest countries in Latin America, Venezuela has been locked in a downward economic spiral, battered by hyperinflation, shortages and political unrest.