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HomeNewsLocal newsWalker Subpoenas Venezuelan Government in Hess Case

Walker Subpoenas Venezuelan Government in Hess Case

Acting V.I. Attorney General Claude Walker has served a subpoena on the government of Venezuela demanding that its government-owned oil company explain its role in the closing of the Hovensa refinery on St. Croix.

The subpoena was issued earlier this month and announced Monday in a Government House news release.

In 1998, Petroleos de Venezuela, South America, now owned by the government of Venezuela, owned half of the entity that financed and operated the refinery. A wholly owned subsidiary of Hess Oil owns the other half.

The V.I. government has accused Hess of breaking the territory’s law by shutting down the refinery almost a decade before its legal obligations were complete. The company has denied the charge and is fighting the issue in court.

The refinery, which was built on St. Croix in the 1960s, was renovated to allow it to process the high-sulfur Venezuelan crude oil from PDVSA. However, once Venezuela fully nationalized PDVSA in 2009, Venezuela became a less attractive long-term partner for Hess.

The suit filed against Hess in September seeks damages of at least $1.5 billion dollars, which covers at least $150 million in annual benefits to the Virgin Islands over the ten-year period from 2012 to 2022 that the government says Hess was obligated to continue operating the refinery.

Venezuela’s PDVSA is due to respond to the subpoena by Nov. 2. According to Government House, the subpoena seeks information and documents related to the decision to shut down the refinery and the company’s profits from the refinery, among other things.

The company announced in 2012 that it would no longer use the site as a refinery.

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