Venezuelan state oil company PDVSA is preparing to issue $2.5 billion in promissory notes to settle unpaid bills to services companies, according to industry sources and documents seen by Reuters. PDVSA has already issued at least $310 million in debt securities as part of a broader effort to prevent crucial oil services providers from downing their tools for lack of payment. The company has hired little-known, Miami-based financial services firm CP Capital to structure 3-year notes with a one-year grace period that will have the same status as PDVSA’s global bonds, according to documents obtained by Reuters. The operation creates additional financial obligations for a company already facing doubts about its capacity to meet ballooning bond payments amid low oil prices, a collapsing socialist economy, and chronic shortages reminiscent of the Soviet bloc. President Nicolas Maduro said any talk of default is part of an international campaign to undermine his government and points out that the ruling Socialist Party has never missed a bond payment.
