(Adds quote, context, Citgo statement)
By Mayela Armas
CARACAS, April 24 (Reuters) - Venezuela’s opposition-controlled National Assembly on Wednesday took a key step toward authorizing a $71 million interest payment on state-owned oil company PDVSA’s 2020 bond, which is backed by shares in its crown jewel asset, U.S. refiner Citgo.
The assembly’s finance committee backed the payment, clearing the way for a full parliament vote expected next week.
Failure to make the payment could pave the way for creditors to attempt to seize up to half of Citgo’s shares as compensation.
President Nicolas Maduro’s cash-strapped government has remained current on the PDVSA 2020 bond payments even as it defaulted on some $8 billion in other debt.
But recent U.S. sanctions on PDVSA, intended to force Maduro to resign to allow opposition leader Juan Guaido to call elections, could prevent any Maduro-linked entity from making the payment.
The National Assembly, led by Guaido and recognized by the United States as Venezuela’s legitimate democratic body, authorized a parallel ad-hoc PDVSA board to negotiate the company’s debt earlier this month. It was unclear what funds the board planned to use to make payments.
Some $1.7 billion remains outstanding on the bond, issued in 2016 at an 8.5 percent coupon. It last traded at 87.5 cents on the dollar, more than triple the value of other bonds issued by PDVSA. The interest payment is due on April 27, but there is a 30-day grace period.
The payment would likely take place during that period, opposition lawmaker Juan Andres Mejia said, adding that the transaction would require a waiver from the U.S. Treasury, which enforces sanctions.
“We want to preserve the asset,” Mejia told reporters, referring to Citgo. “Maduro should not be making these payments. He does not have legitimacy.”
It would mark the first payment undertaken by Guaido’s interim government, a symbolic victory given that Maduro still controls the day-to-day business of government within Venezuela.
Guaido in January invoked the country’s constitution to assume an interim presidency, arguing Maduro’s 2018 re-election was illegitimate.
Maduro calls him a U.S. puppet seeking to oust him in a coup and has accused the opposition of trying to “steal” Citgo.
PDVSA did not respond to a request for comment. (Reporting by Mayela Armas Writing by Luc Cohen Editing by Sonya Hepinstall)