The Dominican Republic is seeking to meet "in the next three months" with Venezuela's state-run oil company PdV about the sale of the Venezuelan firm's 49pc stake in the Refidomsa refinery, Dominican energy ministry officials tell Argus.
Venezuela "has not fulfilled its undertakings" to modernize and expand the 34,000 b/d refinery, and the Dominican government wants to repurchase PdV's interest in the plant, an official said.
The Dominican Republic is willing to allow foreign and local investors to purchase PdV's share in the 41-year-old plant, located at Haina, "so the refinery can be expanded and the modernization program continued," one of the officials said. "There is little to indicate the Venezuelans will carry through on their commitment given in 2010 to expand the plant."
Venezuela has suspended the supply of crude and refined products to the Dominican Republic under the country's PetroCaribe preferential oil supply arrangement, Refidomsa chief executive Felix Jimenez said in October.
The country has not received any Venezuelan oil supplies since January 2016, and the country has been meeting demand through imports from the US, Trinidad and Tobago, Mexico and Nigeria, Jimenez said.
Refidomsa produces diesel, fuel oil, gasoline, jet fuel and LPG.
The Caribbean country produces no oil or natural gas, and imports 155,000 b/d of crude and products to meet demand.
PdV has not said publicly that it wants to dispose of the refinery stake it bought in August 2010 for $133mn, although the financially struggling firm has shed other assets and withdrawn from separate downstream projects that it can no longer afford to fulfill.
The Dominican government bought Shell's 50pc state in the refinery in 2007 for $110mn.
When it purchased its stake in Refidomsa, PdV had pledged to invest $500mn to expand capacity to 60,000 b/d, and later to 150,000 b/d.
"There has been no indication that the Venezuelans will be able to meet any of these promises, and the country and PdV are facing very difficult financial situations," an official said. "As a consequence of this lack of action from Venezuela, we are moving ahead with our own project to develop the plant, starting with the expansion of storage capacity."
Refidomsa will spend $150mn from its own resources to expand storage by 75pc to 1.8mn bl, and to expand the refinery's port facilities, Jimenez said last month.
There have been indications of interest in the PdV stake from local and foreign companies, Jimenez said.
Dominican president Danilo Medina, who was re-elected last year, would support the government's purchase of the PdV stake, Jimenez said, without indicating how the government would pay for it.
The Venezuelan energy ministry has told Argus that PdV has no intention of selling its stake in the refinery.
