Active Development AidData Chinese Aid

ICBC participates in $2.206 billion syndicated loan for Puerto La Cruz Refinery Deep Conversion Project

¥1.1M RMB

Funder	Industrial and Commercial Bank of China (ICBC)
Recipient Organization	PDVSA Petróleo, S.A.
Country	Venezuela
Start Date	Jun 27, 2012
End Date	Jan 23, 2033
Duration	7,515 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`58367`

Grant Description

ICBC contribution to $2.206 billion syndicated loan for Puerto La Cruz Refinery Deep Conversion Project In July 2012, Petróleos de Venezuela, S.A. (PDVSA) awarded a $2.993 billion EPC contract to Wison Engineering Ltd., Hyundai Engineering & Construction Co. Ltd. and Hyundai Engineering Co,. Ltd. for the Puerto La Cruz Refinery Deep Conversion Project.

The EPC contract specified that the China-based Wison Engineering Ltd. would receive a share equivalent to approximately $927.8 million.

On June 27, 2012, Credit Suisse AG and ICBC signed a $1 billion syndicated loan (credit facility) agreement with PDVSA Petróleo, S.A. for the Puerto La Cruz Refinery Deep Conversion Project. The loan had principal amortizations every six months and a grace period of 16 months. As of December 31, 2012, the loan had achieved an 47.8% disbursement rate ($478 million out of $1 billion).

The proceeds of the loan were to be used by the borrower to finance Wison Engineering Ltd.’s share of the EPC contract that was signed in July 2012.

Then, on September 3, 2014, PDVSA Petróleo, S.A. entered into an extension of the syndicated loan (credit facility) agreement with Credit Suisse and ICBC in June 2012 for $1.289 billion, with some of the terms and conditions of the initial agreement being modified.

The new amount of the credit facility was $2.206 billion, with quarterly payments and a grace period of 14 months, earmarked for the modification and expansion of the Puerto La Cruz Refinery. The loan's amount outstanding was $1.477 billion as of December 31, 2014 and $1.95 billion as of December 31, 2015.

The Puerto La Cruz Refinery Deep Conversion Project, which is located in the city of Puerto La Cruz and the state of Anzoategui, seeks to convert existing units, thereby enabling the refinery to process 210,000 barrels per day (bpd) of heavy and extra heavy crude oil from oil reserves in the Orinoco Oil Belt (FPO) instead of the 180,000 bpd of light and medium oil that it currently processes.

Wison Engineering Ltd., Hyundai Engineering & Construction Co. Ltd. and Hyundai Engineering Co,. Ltd. are the general EPC contractors responsible for project implementation.

Wison Engineering then subcontracted China Tiesiju Civil Engineering Group (CTCE), China Railway No.9 Group (CREC-9), China Railway Tenth Engineering Group (CREC-10) and TREVI to assist in early activities related to the site preparation works. Site preparation works for an expansion called the Deep Conversion Project began at the refinery on July 21, 2014.

Module assembly commenced on March 15, 2015. Then, on November 14, 2015, a bridge was erected across the oil pipeline in the EW-02 area. The project celebrated 2 million man hours without an accident on November 16, 2015. By May 2017, the project had achieved a 79% completion rate. The commissioning of the project was originally expected to take place 2020.

However, as of April 2025, AidData had not yet identified any evidence of project completion. The various stakeholders involved in this project have faced several major obstacles and controversies.

In July 2014, Banco Espírito Santo — a troubled Portuguese bank — received a $835 million loan from Oak Finance Luxembourg SA (a special purpose vehicle incorporated in Luxembourg and owned by Goldman Sachs) for the Puerto La Cruz Refinery Deep Conversion Project before it was bailed out and broken up by Portugal's central bank (Bank of Portugal) in August 2014.

Despite Banco Espírito Santo’s collapse, the debt was transferred to Novo Banco, a new lender (a “good bank”) that was created out of Banco Espírito Santo (the “bad bank”). The $835 million loan was supposed to be repaid.

However, on December 23, 2014, Novo Banco made a surprise announcement: the Bank of Portugal had informed it that Oak Finance Luxembourg SA would remain in the “bad bank” that the central bank was winding down, virtually guaranteeing that the loan would not be be fully repaid.

The reason: a Portuguese law passed in August 2014 said that anyone owning more than 2% of a bailed-out bank’s shares would have to go to the back of the line for any debt repayments. Goldman’s 2.27% shareholding in July 2014 triggered that provision retroactively, the Bank of Portugal concluded.

Goldman Sachs then accused the Bank of Portugal of breaking its word and warned that the decision would hurt the pension funds that bought Oak Finance Luxembourg SA debt.

Then, in August 2015, Wison Engineering Services Co Ltd was found guilty of bribery after an investigation by the Chinese government and ordered to pay a fine of RMB 30 million ($4.83 million).

The firm’s controlling shareholder, Hua Bangsong, was also sentenced to 36 months in jail on the same charge (as part of a Chinese police crackdown on oil industry corruption. In 2018 workers from the project were also involved in a protest over low wages, unpaid bonuses, and lack of benefits.

📋 Staff Comments

This project is also known as the RPLC Deep Conversion Project In Venezuela. The Chinese project title is 拉克鲁斯炼油厂场地平整项目 or 拉克鲁斯炼油厂场坪工程(惠生项目) or 委内瑞拉RPLC场平项目.
ICBC was reportedly the main lender in the loan syndicate. However, the precise monetary value of its contribution to $2.206 billion syndicated loan is unknown. For the time being, AidData assumes equal contributions ($1.103 billion) across the two known participants in the loan syndicate. More research is needed to determine the individual contributions of each bank that participated in the syndicate.
Some sources indicated the PDVSA established an Irish-incorporated special purpose vehicle as the borrowing institution (in coordination with Hyundai and Credit Suisse). This issue warrants further investigation.
It appears that Hyundai Engineering & Construction Co. Ltd. partially financed the July 2012 EPC contract. However, this issue requires further investigation.

📚 Sources & References

Hogan Lovells Advises PDVSA on US$1 Billion Financing Deal with Russian Bank
Empresa Conkor, ligada a Tarek William Saab, recibió millones en contratos con Odebrecht
China
Russia
India, and the Venezuelan Petroleum Industry
Puerto La Cruz Refinery Deep Conversion Project
Anzoategui, 2015 Annual Report
China Plans to Revive Venezuela’s Collapsing Petroleum Industry
Puerto La Cruz Refinery Deep Conversion Project
Anzoategui
Venezuela
Exhibit D
Wison Annual Report 2013
Hogan Lovells' Project Finance Practice Named to Law360’s 2012 Practice Groups of the Year
ANNOUNCEMENTINSIDE INFORMATIONUPDATES ON RECENT DEVELOPMENTS OF THE COMPANYRESUMPTION OF TRADING
Exhibit D to the Bolivarian Republic of Venezuela's Annual Report on Form 18-K
惠生工程收到委内瑞拉国家石油公司拉克鲁斯炼油项目总承包中标通知书
拉克鲁斯炼油厂场地平整项目开工惠生工程布局南美“落子”委内瑞拉
惠生工程再夺委内瑞拉炼油厂深度转化项目合同
中安在线：中铁四局承建的委内瑞拉拉克鲁斯炼油厂场坪工程(惠生项目)开工建设
惠生工程再获委内瑞拉炼厂合同, 2013 Annual Report
委内瑞拉RPLC场平项目Front 1区域移交开始
中铁十局委内瑞拉RPLC场平项目给员工家属拜年啦
中铁十局委内瑞拉RPLC场平项目部 “工地图书馆”正式开馆
委内瑞拉拉克鲁斯炼油厂跨输油管道桥梁架设成功
CIP For RPLC Deep Conversion Project In Venezuela
Wison Successfully Delivered its First Batch of Stick Built for RPLC Refinery Project
Hyundai Engineering Co.
Ltd Separate Financial Statements
Wison Engineering Wins US$500 Million Puerto La Cruz Refinery Project in Venezuela
Goldman Sachs Licks its Wounds After Being Ensnared in its Own Murky Web
Goldman Sachs Readies for a Fight Over $835 Million Loan to Banco Espírito Santo
International Firms
Hogan Lovells' Project Finance Practice Named to Law360’ s 2012 Practice Groups of the Y ear
Hyundai-Wison JV wins contract refinery project
Puerto La Cruz refinery deep conversion project to receive new financing from Hyundai Engineering & Construction
PetroChina supplier Wison says found guilty of bribery in China
Inside Goldman Sachs’s Loan to Banco Espírito Santo
Bank Resolution: English and German Courts Place Limits on Obligations to Give Effect to Actions of Resolution Authorities in Other Member States
Doubts surround Venezuela refinery project
CNOOC Limited Annual Report 2013
CNOOC Limited Form 20-F For the month of August 2013
CNOOC seeks US$6b loan to purchase Nexen
BASIS POINT-ICBC eyes emerging markets as it expands global presence
案例分析：中海油收购尼克森
BASIS POINT-CNOOC seeks financing from domestic, foreign banks for Nexen bid
Industrial and Commercial Bank of China Limited 2012 Annual Report
Bank of China Annual Report 2013
ICBC Rises to Top Syndicated Loan Lead Arranger in the Asia-Pacific Region
Agricultural Bank of China 2012 Corporate Social Responsibility Report
CNOOC Limited completes acquisition of Nexen Inc.
Chinese Companies Are the New Force in Global M&A
Luxembourg, a European gateway for China: update on Private Equity and M&A
CNOOC Limited Annual Report For the fiscal year ended December 31, 2012
CNOOC Limited Annual Report For the fiscal year ended December 31, 2013
CNOOC seeks $3bn for Aussie acquisition
Nexen Secures U.S. Approval of Its Sale to Cnooc of China
Loan Week
February 15-21
CNOOC Seeks $6B Loan to Back Nexen Buy
CNOOC Limited Announces Pricing of Guaranteed Notes Offering
CNOOC signs US$6 billion loan for Nexen acquisition
CNOOC eyes US$10b in bonds and loans to fund Nexen deal
Highly commended Asian deal of the year 2013: CNOOC/Nexen
路透基点：中海油正在寻求15亿美元五年期子弹式离岸贷款--TRLPC, 4 questions about China's Nexen bid
Nexen deal comes back to haunt CNOOC, ‘A parade of broken promises’: How CNOOC stumbled with its Nexen takeover
China Development Bank Annual Report 2013, 2015 Consolidated Financial Statements
Puerto La Cruz Refinery Deep Conversion Project
Anzoategui
Default by PDVSA with contractors causes paralysis of refinery pattern change works in Puerto La Cruz
PDVSA asegura que conversión profunda en refinería de Puerto La Cruz tiene avance de 80%
Obreros denuncian violación de condiciones laborales en ampliación de refinería de Puerto La Cruz Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.

All Grantees

PDVSA Petróleo, S.A.

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