CITGO Sold to Amber Energy

Photograph courtesy of CITGO Petroleum

CITGO Petroleum Corp., which flies its brand flag at more than 4,300 U.S. gas stations, has a new owner. Amber Energy Inc., a newly formed company backed by a group of U.S. energy investors including Elliott Investment Management LP, will acquire PDV Holding Inc., the parent of refiner and marketer CITGO, for approximately $7.3 billion. Robert Pincus, the special master appointed by the U.S. District Court for the District of Delaware to oversee the sale of PDV Holding, selected Houston-based Amber Energy as the successful, court-approved bidder for CITGO.

CITGO is a subsidiary of Venezuela’s national oil company, Petróleos de Venezuela S.A. (PDVSA). With U.S. headquarters in Houston, the company owns and operates refineries in Lake Charles, Louisiana, Lemont, Illinois, and Corpus Christi, Texas, with a combined crude oil capacity of approximately 807,000 barrels per day (bpd), making it the fifth largest independent refiners in the United States. Wholly or jointly, it also owns 42 terminals, eight pipelines and three lubricants blending and packaging plants. The company has approximately 3,600 employees.

CITGO supplies fuel to more than 4,300 independently operated branded retail outlets in 31 states, all east of the Rocky Mountains.

History

Cities Service Co. created the CITGO brand in 1965. It was acquired by Occidental Petroleum in 1982. Southland Corp., the founding company of 7-Eleven, acquired the CITGO brand in 1983. 7-Eleven sold half of CITGO to PDVSA, in 1985, which acquired full ownership in 1990.

In 2020, Venezuela put CITGO on the market. Political and economic unrest and corruption under presidents Hugo Chavez and Nicholás Maduro and the possibility of Russia gaining control of CITGO led to U.S. sanctions. The company also faced legal action by creditors, leading to the court-designated auction.

Although CITGO is owned by Venezuela, in 2019 it severed ties with PDVSA. It is since operating under a U.S. license that protects it from creditors. Any buyer needs U.S. Treasury approval to acquire CITGO.

Amber Energy’s Strategy

Amber Energy is committed to working with CITGO team members to strengthen performance across CITGO’s operations, it said. The company said it “recognizes the importance of the CITGO brand and the significant role the company has played in the global energy economy.” Amber Energy intends to maintain the brand “to build upon its more than 110-year history, while strengthening the long-term potential of the business through a focus on operational improvements, strategic growth efforts and a continued focus on sustainability.”

Amber Energy’s strategy for growth includes plans to reinvest in the business and potentially pursue strategic investments that enhance profitability, it said. 

Amber Energy’s management team—led by CEO Gregory Goff and President Jeff Stevens—has decades of experience leading companies in the energy industry and is committed to further strengthening CITGO as a leader in the refining, transportation and marketing of petroleum products, it said. The Amber Energy board of directors will include Goff, Stevens and other Elliott Management representatives with industry expertise. 

“We thank the special master for selecting Amber Energy as the successful bidder and recommending that the court approve Amber Energy’s acquisition of CITGO’s world-class assets,” said Goff. “Building upon CITGO’s legacy, and with a focus on the future, we will prioritize operational excellence to lay a foundation for stability, strength, and long-term success for the benefit of the company’s people, customers and communities. We look forward to partnering with the people of CITGO to ensure that the company continues to operate with the highest standards of safety and reliability.” 

“By enhancing the value of its core assets, CITGO has the potential to significantly improve its ability to provide attractive future growth opportunities for its customers, team members, and the local communities it serves,” said Stevens. “We believe in CITGO’s fundamental strengths and are confident we have the operational expertise and capital necessary to elevate CITGO as a leader in the refining, transportation and marketing of products that help power our economy.” 

Currently, Goff is CEO of Claire Technologies, which provides low-carbon solutions to decarbonize the energy and transportation sectors. Previously, he was chairman, president and CEO of Andeavor. Before that, he was with ConocoPhillips in leadership positions in exploration and production, downstream and commercial.

Currently, Stevens is president of Franklin Mountain Energy, focused on the acquisition and development of oil and gas properties in the Permian Basin. He was founding partner and CEO of Western Refining Inc., an independent refining and marketing company.

Activist investor Elliott Management, New York, is a major shareholders of refiner and marketer Marathon Petroleum, Findlay, Ohio, and holds a stake in the refiner and marketer Phillips 66, Houston.

Amber Energy expects the transaction to close in mid-2025, pending regulatory and other approvals, including approval by the District Court and the satisfaction of certain conditions related to the court process.

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Greg Lindenberg has been covering convenience-store news and writing about the c-store and gas station industries for more than a quarter of a century. He specializes in mergers-and-acquisitions (M&A) news.

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