TCRLA_Public/060126.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                    L A T I N   A M E R I C A

          Thursday, January 26, 2006, Vol. 7, Issue 19

                            Headlines

A R G E N T I N A

BANCO PATAGONIA: 2005 ROE Jumps to 38% on Extraordinary Gains
REPSOL: Inks Exploration & Production Pact with Tierra del Fuego
* MENDOZA: District Court's Ruling Upheld by Court of Appeals


B R A Z I L

AMPLA ENERGIA: Board Approves Generation Asset Sale to Sabricorp
BANCO FIBRA: S&P Rates $50 Million Senior Unsecured Debt at 'B+'
CATAGUAZES-LEOPOLDINA: S&P Says Sale Does Not Affect Ratings
CEF: Perto Wins Bid to Supply 4,960 Automated Teller Machines
CSN: Volatile Demand Prompts S&P's BB Rating on Corporate Credit

NATIONAL STEEL: S&P Affirms 'B+' Corporate Credit Rating
* Central Bank Cuts Key Lending Rate to 17.25%


C A Y M A N   I S L A N D S

CUFRA CONSULTING: To Lay Accounts on Liquidation on February 6
EDGE INVESTMENT: Sets Final Meeting on February 16
EDGE INVESTMENT: Showing Manner of Liquidation on February 16
HAMILTON MULTI-STRATEGY: To Present Liquidation Accounts
SURF CAPITAL: Schedules Final Meeting on February 9


C O L O M B I A

MINERCOL: Deadline to Liquidate Assets Moved to Dec. 31


C O S T A   R I C A

* Government Investing US$660 Million for Diesel Generators


J A M A I C A


* NY Stock Exchange Executive Projects 3% GDP Growth This Year


M E X I C O

AXTEL: Investing US$150 Million to Fund Expansion in Five Cities
CFE: Inks Power Accord with CNFL and ICE
TELMEX: Issuing 10-Year Peso Bonds on International Markets
TELMEX: To Pay US$428,306 for Refusing SCE of Billing Details


P A N A M A

AES CORP: AES Panama in Talks to Improve Condado Watershed
AES CORP: TermoAndes Arbitration Seeks US$10MM for Gas Supplies


P U E R T O   R I C O

DORAL FINANCIAL: Gets Holders' Consent to Indenture Amendments
DORAL FIN'L: Inks Supplemental Indenture for Floating Rate Notes
MUSICLAND HOLDING: US Trustee Appoints 7-Member Creditors Panel


U R U G U A Y

NUEVO BANCO: Advent International Agrees to Delay Sale Closing


V E N E Z U E L A

PDVSA: Aiming to Surpass Saudi Arabia's Oil Production
PDVSA: Contributes US$22.3 Billion to State Coffers in 2005

     -  -  -  -  -  -  -  -

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A R G E N T I N A
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BANCO PATAGONIA: 2005 ROE Jumps to 38% on Extraordinary Gains
-------------------------------------------------------------
Banco Patagonia realized a 38% financial gain for 2005 as a
result of the appreciation of government-backed securities,
financial director Ruben Iparraguirre told Business News
Americas.  In 2004, the bank recorded an ROE of 20%.

Mr. Iparraguirre said this the bank's ROE will come down to more
normal levels this year as the extraordinary gains were a one-
off phenomenon, Business News reports.

In 2002, former President Eduardo Duhalde imposed the conversion
into pesos of dollar-denominated loans and deposits during
Argentina's economic and financial crisis.  Banks received 8.5
billion pesos in government bonds in compensation, Business News
relates.

"We valued those bonds at market value, which was around 60-70%
of their technical value.  The government allowed banks to price
those bonds at their technical value but we did not use this
exemption.  Due to Argentina's improved economy, the bonds are
now priced at about 90% of their technical value, so we reaped
the benefits of that," Mr. Iparraguirre told Business News.

The bank also expanded its loan portfolio by 70% to 1.3 billion
pesos in 2005.  The bank wants to maintain or surpass the loan
growth this year.  Patagonia currently commands 2.2% market
share in the Argentine loan market, Business News relates.

Mr. Iparraguirre disclosed to Business News that Patagonia would
buy the bidding rules for the upcoming sale of fellow local bank
Banco Bisel.

Business News relates that Bisel was left behind along with
Bersa and Suquia by French banking giant Credit Agricole after
the latter withdrew from Argentina in the midst of the country's
economic and financial crisis in 2002.  The three were taken
over by the country's largest bank, federally owned Banco
Nacion, with the aim of selling them back to the private sector
at a later stage.  Banco Nacion is not expected to publish the
Bisel bidding rules before March.

Banco Patagonia became Argentina's fifth largest locally owned
private bank through its purchase of Lloyds TSB Argentina in
late 2004.  The bank's equity totaled 789 million pesos and its
assets 4.22 billion pesos at November 30, 2005.

In 2004 the bank posted a 90.8 million-peso (US$30 million) net
profit compared to a 594 million-peso loss in 2003.  Patagonia's
profits amounted to 196 million pesos at November 30, 2005.

                        *    *    *

On Dec. 12, 2005, Moody's Latin America Calificadora de Riesgo
S.A. reaffirmed the 'BB' rating on US$80 million worth of bonds
issued by Banco Patagonia S.A. (f.k.a. Banco Patagonia Sudameris
SA), the CNV revealed in its Web site.

The undated bonds were described as "Serie 3 Oblig Negociables"
and are classified under "Series and/or Class."

The rating reflects the bank's financial status as of Sep. 30,
2005.  A "BB" rating indicates that the future of these bonds
cannot be well assured.


REPSOL: Inks Exploration & Production Pact with Tierra del Fuego
----------------------------------------------------------------
Repsol YPF representative Juan Carlos Fernandez Zarate signed a
contract with Tierra del Fuego, Argentina's governor Hugo
Coccaro to promote exploration and production of hydrocarbons in
areas owned by the provincial government, Business News Americas
reports.

Under the agreement, Repsol will determined the mechanisms and
joint procedures for the exploration and production of
hydrocarbons in areas owned by the province through
constitutional mandate, Business News relates.

Other than its potential exploration upside, Tierra del Fuego
also offers an attractive tax-free zone to foreign oil
companies.

"We know about the province's potential in terms of oil and gas
but we need a strong investment.  We have decided to sign an
agreement for reciprocal cooperation so our technical teams can
keep working and see the possibility of investment in the
future," newspaper Ambito Financiero quoted Mr. Coccaro.
"We have invited the representatives of YPF in the same way we
did with the consortium of Total, Wintershall and Panamerican
Energy, which are the companies that work in this area."

Natural gas production has started in June 2005 from the Carina
and Aries fields in the Cuenca Marina Austral-1 (CMA-1) block
off the coast of Tierra del Fuego.  Gas production from Carina
and Aries will gradually substitute declining production on
existing fields in Tierra del Fuego and supply more gas to the
Argentine market.

                        *    *    *

On June 20, 2005, Moody's Investors Service upgraded the ratings
of Spanish oil company Repsol YPF's local subsidiary YPF S.A.
Moody's upgraded YPF's senior unsecured rating to Ba3 from B1
and the unit's domestic currency issuer rating to Baa2 from
Baa3.

YPF's foreign currency issuer rating of Caa1 remained unchanged,
as it is constrained by the sovereign ceiling of Argentina.
YPF's Corporate Family Rating (formerly known as the senior
implied rating) is aligned with the foreign currency issuer
rating at Caa1.


* MENDOZA: District Court's Ruling Upheld by Court of Appeals
-------------------------------------------------------------
The U.S. Court of Appeals, Second Circuit, slammed Greylock
Capital Management's bid to reverse a decision issued by the New
York Southern District Court approving Mendoza, Argentina's debt
restructuring in 2004.

Maria Jose Van Morlegan, Esq., said in a prepared statement to
the Buenos Aires Exchange that the Court of Appeals supported
District Court Judge Harold Baer's decision that affirmed the
fairness of the terms of the debt exchange.

Ms. Morlegan said that the court agreed with Mendoza's argument
that the contract that regulated the debt exchange allowed for a
simple majority of bondholders to accept the province's use of
special clauses to repeal its sovereign immunity.

According to Dow Jones, the so-called "exit consent clauses"
were challenged by Greylock and by Rabbi Jacob Joseph School,
another bondholder that had declined to participate in the
exchange, on the grounds that they impair their capacity as
holdouts to sue the province for non-payment of its bonds.


===========
B R A Z I L
===========


AMPLA ENERGIA: Board Approves Generation Asset Sale to Sabricorp
----------------------------------------------------------------
As previously reported on Jan. 3, Ampla Energia e Servico inked
an asset sale agreement with Sabricorp Participacoes.  Under the
APA, Ampla's generation assets will be sold for 105 million
reais (US$46.5 million), Business News Americas reports.

At a meeting on Jan. 19, Ampla's Board of Directors gave its
stamp of approval to the transaction, Business News states.  The
sale of the assets includes nine power plants with combined
capacity of 62MW.  The sale of the generation assets awaits
approval of the power regulator, Aneel.

According to Business News, the company's decision to sell the
assets is in compliance with a power sector legislation that
requires Brazilian companies to separate generation and
distribution assets completely.

Ampla, formerly known as Cerj, was privatized in 1996 and is
controlled by Spanish power company Endesa (NYSE: ELE).

The Company's major shareholders are the Endesa/Enersis group
with 91.9% and Energias de Portugal S.A. with 7.7%.  In 2004,
the
Company distributed 7,292 megawatt-hours to 2.1 million
customers, representing a 2.4% share of Brazil's electric
distribution market.

                        *    *    *

On Nov. 25, 2005, S&P assigned a BB- corporate credit rating to
Brazilian electric utility Ampla Energia e Servicos.


BANCO FIBRA: S&P Rates $50 Million Senior Unsecured Debt at 'B+'
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned on its 'B+' foreign-
currency senior unsecured debt rating to Banco Fibra S.A.'s $50
million notes to be issued under the bank's $250 million EMTN
program.  The issue matures in three years with semiannual
payments.  The outlook is stable.

"The ratings on Banco Fibra S.A. incorporate the bank's low
profitability when compared with that of the industry; the
challenge to build a diversified funding base given the natural
concentration of its deposits, an issue for most wholesale
banks; and its exposure to the fierce competition affecting most
banks operating in the segment of midsize companies, and the
consequent pressure on margins," said Standard & Poor's credit
analyst Beatriz Degani.

These risk factors are tempered by the bank's strong asset
quality indicators; its good track record and expertise in the
corporate and middle-market segments; strong liquidity to face
economic downturns and cover unexpected losses; and the benefits
in terms of ownership with the implicit support from the
shareholder.

Banco Fibra is a commercial midsize bank, positioned as the
20th-largest private bank in Brazil, with total assets amounting
to Brazilian reais (BrR) 9.2 billion (US$3.9 billion) as of June
2005.  Despite its relatively small market share, Banco Fibra is
among the top banks operating in the small corporate and middle-
market segments, currently serving approximately 750 corporate
clients.

The stable outlook reflects our expectation that the bank will
be able to successfully implement its growth strategy in the
middle-market segment and still sustain its good asset quality
indicators (NPLs) at a rate of less than 4% and maintain a BIS
ratio of more than 15%. We also expect profitability to improve
to an adjusted ROA of about 2%. The outlook could be revised to
negative or the ratings could be lowered if there is a
significant deterioration in Banco Fibra's asset quality ratios
(vis-a-vis its current levels); if the bank's liquidity and
funding are pressured; or if it fails to show more robust
profitability levels.

Conversely, the outlook could be revised to positive or the
ratings could eventually be raised in the longer term, depending
on the bank's capacity to deliver the expected results of its
growth lending strategy in a consistent manner during a longer
period of time. Such a positive rating action would also depend
on the bank sustaining its strong liquidity position.


CATAGUAZES-LEOPOLDINA: S&P Says Sale Does Not Affect Ratings
------------------------------------------------------------
Standard & Poor's Ratings Services said on Jan. 20, 2006, that
Alliant Energy Corp.'s (BBB+/Stable/A-2) announcement that it
will sell its sizable minority ownership in the Cataguazes Group
does not affect ratings on Brazilian electric utility Companhia
Forca e Luz Cataguazes-Leopoldina (Cataguazes-Leopoldina;
B+/Negative/--).

Alliant currently holds significant minority stakes at
Cataguazes-Leopoldina and other companies in the Cataguazes
Group, and it is selling its entire Brazilian portfolio to the
Brazilian private-investor Antonio Jose de Almeida Carneiro for
US$152 million.  For the ratings on Cataguazes-Leopoldina, this
minority ownership sale is positive because of the contentious
relationship between Alliant and the Botelho family (the
controlling shareholder).

Since 2003, Alliant and the Botelhos have disagreed on several
aspects regarding the Group's management, resulting in a
conflictive relationship between the parties.  This divergence
is one of the risk factors for Cataguazes-Leopoldina's ratings
because it could impose financial obligations on the Group or
might affect its business performance.

Currently, there are some legal proceedings filed by Alliant and
still awaiting a Brazilian court's final decision, which,
according to Mr. Carneiro's announcement, would be completely
withdrawn when the sale closes on Jan. 26, 2006.


CEF: Perto Wins Bid to Supply 4,960 Automated Teller Machines
-------------------------------------------------------------
Business News Americas reports that Brazilian tech firm, Perto,
won a 77 million-real (US$33.8 million) contract to supply 4,960
automatic teller machines for the country's second largest bank,
federally owned Caixa Economica Federal.

Santa Catarina-based Perto topped Diebold Procomp and Itautec's
bids in a public online tender.  According to Perto the contract
represents the biggest self-service equipment deal in Brazil's
banking sector during the last several years, Business News
relates.

Perto aims to complete the project in 18 months.

Perto has already installed 20,000 ATMs in Brazil for Dutch bank
ABN AMRO and local financial institutions Banco do Brasil,
Bradesco, Nossa Caixa and Unibanco.

Brazil is estimated to have some 140,000 ATMs.

                        *    *    *

On Oct. 19, 2005, Moody's Investors Service upgraded Caixa
Economica Federal's long-term foreign currency deposit rating to
B1 from B2 with a positive outlook.

The action followed Moody's upgrade of Brazil's foreign currency
ceiling for deposits to B1, from B2, and the foreign currency
country ceiling for bonds and notes to Ba3, from B1. The country
ceilings have a positive outlook.


CSN: Volatile Demand Prompts S&P's BB Rating on Corporate Credit
----------------------------------------------------------------
Standard and Poors' Rating Services gave on Jan. 20, 2006, a
'BB' corporate credit rating on Brazilian flat carbon steelmaker
Companhia Siderurgica Nacional.

The 'BB' corporate credit rating on CSN reflects the company's
exposure to volatile demand and price cycles, increasing
competition in its home and predominant market of Brazil,
aggressive dividend policy and capital investment plan, and
sizable gross-debt position.  These risks are partly offset by
CSN's privileged cost position and sound operating profile,
favorable market position in Brazil, strong export capabilities
to offset occasional domestic demand sluggishness, and
increasing business diversification.

CSN is one of the lowest-cost steel producers in the world,
which is a result of its access to proprietary, high-quality
iron ore (at the Casa de Pedra mine); self-sufficiency in
energy; streamlined facilities; and logistics advantages.  This
is in addition to the group's strong market position in the
fairly concentrated steel industry in Brazil.

The domestic market remained weak through second-half 2005 with
significant impact on CSN's sales in Brazil, leading the company
to export 48% of its production in the period under mixed price
conditions (as US and Europe remained somewhat weak).

CSN is expected to continue performing substantially better than
its international peers due to its proprietary iron-ore reserves
and resulting favorable cost position.  An expansion of its mine
capacity is under way, and incremental production is expected to
be sold under long-term contracts.

CSN's operating performance in the past 12 months ended Sept.
30, 2005, remained sound, though slowing down somewhat.  Rising
coal prices were partly offset by a continuing and significant
decline in the cost of coke and the foreign currency rate
appreciation.  The company announced that it closed a coke
purchase contract that covers half of its coke requirements in
2006, which should moderate the impact of this specific
feedstock in its cost matrix in the next several quarters.

With an EBITDA margin hovering in the range of 45%-50%, CSN
should continue performing well above international peers and
reporting strong credit measures.  As calculated by Standard &
Poor's, CSN's EBITDA margin reached a high 49% in the past 12
months ended Sept. 30, 2005, boosted primarily by a better
product mix, with increased galvanized steel.  EBITDA interest
coverage and funds from operations FFO to adjusted total debt
were at 4.8x and 19.8%, respectively, in the 12 months ended
Sept. 30, 2005, weakened by derivatives losses due to currency
appreciation and a substantial increase in total debt, as the
company kept issuing long-term loans, including perpetual notes,
in order to further strengthen its liquidity position.

The company is expected to gradually pay down more expensive and
shorter-tenor loans in the next several quarters with the built-
up cash position, somewhat moderating financial leverage in
2006.  Nevertheless, we highlight that CSN should remain exposed
to the risk of a rapid deterioration of its gross-debt financial
ratios if market conditions weaken further in the medium term,
considering that the company's gross financial leverage should
remain significantly high in the near future.

The group's total gross debt, adjusted for debt at CSN's
controlling shareholder Vicunha Siderurgia S.A. aka VicSid and
pension liabilities, amounted to nearly $5.3 billion at Sept.
30, 2005 -- compared with $4.2 billion in December 2004 --
boosted by $750 million in perpetual notes issued in July 2005.

Debt at the parent company level amounted to BrR1.2 billion in
debentures -- approximately $520 million -- that may be replaced
by a perpetual notes issuance at a higher layer of its corporate
structure National Steel S.A., or NatSteel.

Upon the conclusion of this transaction, VicSid, as well as
other layers in the structure -- including Vicunha Acos S.A. aka
VicAcos -- are expected to be virtually free of any debt
obligation.  While the change in the debt profile at
shareholder's level is positive in the short term to CSN, as it
tends to reduce dividend requirements and allow CSN to hold a
higher proportion of its cash flow to fund capital expenditures,
we will continue to view NatSteel's notes as if they were CSN's
own debt for the purposes of financial ratio calculation.

Additionally, at higher levels in the company's ownership
structure, the controlling Steinbruch family has a private
agreement to take its old partner over, which also suggests that
despite lower cash requirements at NatSteel's level, CSN's
dividend policy will remain aggressive in order to service cash
requirements at higher layers of the corporate structure.

Liquidity

CSN's liquidity has been an important short-term mitigating
factor to the company's increasing gross-debt position and
persistently high short-term debt maturities.  Cash reserves
amounted to $2 billion at Sept. 30, 2005, and remain
exceptionally high, having averaged about $1.1 billion in 2004.
Cash liquidity is more than enough to cover short-term debt
maturities of $844 million within the next 12 months through
September 2006.

We expect some reduction in debt balances in the fourth quarter
of 2005 and the first half of 2006, but at a gradual pace.  As a
result, high gross debt balances should continue to translate
into a high interest burden; currency volatility should also
continue to have a relevant effect on the company's overall
financial performance.  Refinancing risk is mild.  There is some
debt concentration in 2008, 2013, and 2015 coming from bullet
bond maturities.

The company is expected to reach adequate long-term financing to
fund a portion of programmed investments, while the remainder
will likely be financed with internal cash generation, as we
still expect strong FFO for the next several quarters due to the
favorable fundamentals.

Outlook

The stable outlook reflects our expectations that CSN will
manage to preserve strong liquidity in the near future thanks to
its robust cash generation and despite its significant capital
expenditures program and dividend distribution.  The outlook
also assumes that CSN will be able to maintain sound operating
results through the steel cycle thanks to its favorable cost
position and access to steel export markets.

The rating could come under downward pressure if a continuing
increase in gross debt leads financial metrics to deteriorate in
a permanent manner.  Acquisitions or further capital commitments
that could potentially hurt the company's current liquidity
condition or add financial leverage are not assumed and could
equally lead to a negative revision of the ratings or a negative
outlook.

On the other hand, strengthening results to levels not factored
in or a more moderate financial stance (essentially deriving
from lower total gross debt balances and lower exposure to
short-term debt) could lead to a positive revision of the
ratings or outlook in the medium term.  However, this scenario
is seen as unlikely considering the company's significant
capital and dividend commitments already scheduled for the near
future.


NATIONAL STEEL: S&P Affirms 'B+' Corporate Credit Rating
--------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on National Steel S.A., a company incorporated in
Luxembourg and one of the indirect shareholders of Brazilian
flat carbon steel maker Companhia Siderurgica Nacional (CSN,
BB/Stable/--).  The 'B+' rating assigned to NatSteel's
forthcoming perpetual notes in the amount of $500-million
perpetual notes was also affirmed.  The outlook is stable.

NatSteel is a special-purpose vehicle whose only purpose is to
hold the perpetual notes and a direct stake in Vicunha Aos
S.A., an intermediary holding company that controls Vicunha
Siderurgia S.A., which in turn holds a 42.74% voting stake of
CSN.

"The rating on the perpetual notes reflects CSN's ultimate
ability to upstream dividends to NatSteel throughout the layers
of its corporate structure," said Standard & Poor's credit
analyst Reginaldo Takara.  "The rating is two notches lower than
CSN's 'BB' corporate credit rating to reflect structural
subordination of the perpetual notes relative to CSN's own
operating and financial obligations."  We believe that CSN's
controlling shareholder has significant economic incentives to
make dividend distribution to be approved in amounts sufficient
to comfortably pay interests on the notes.  Furthermore, we do
expect CSN to sustain strong cash flow fundamentals in the
future based on its very low-cost structure and market position
and thus upstream dividends without compromising its own
financial profile.

Nevertheless, we assess subordination and recovery prospects on
the perpetual notes by assuming a default scenario for CSN,
under which the steel maker's ability to distribute dividends
would already have been compromised and NatSteel's perpetual
bondholders would be in a significantly disadvantageous position
compared with creditors at CSN's level.  We estimate that
operating (suppliers, employees, taxes) and financial
liabilities at CSN's level represent more than 50% of CSN's
adjusted total assets, which significantly reduces recovery
prospects in a scenario of CSN's default. While the perpetual
notes will have a first pledge of a 17% stake of CSN's shares,
which provided bondholders with a comfortable coverage of about
two times the notes' principal amount, Standard & Poor's is
typically skeptical about share collateral values in the long
run (more so for a perpetual issuance), especially when assuming
a default scenario, which implies that only minimal if any
credit is given to the collateral when determining recovery
prospects for perpetual bondholders.

The outlook on NatSteel's rating is based on the corporate
credit ratings on CSN.  The stable outlook on CSN reflects our
expectations that CSN will preserve strong liquidity and sound
operating results through the steel cycle.

NatSteel's rating could come under downward pressure if CSN
further increases gross debt levels or acquisitions or further
capital commitments potentially hurt CSN's current liquidity
condition.  The ratings' upward potential is limited by CSN's
significant capital expenditures program in the next couple of
years and current relatively aggressive gross debt leverage.


* Central Bank Cuts Key Lending Rate to 17.25%
----------------------------------------------
The Associated Press reports that Brazil's central bank cut the
country's benchmark lending rate for a fifth consecutive month
in an effort to stimulate an economic recovery.  The reference
Selic rate was reduced to an annual 17.25% from 18% with no
bias.

Observers noted that Brazil's IPCA inflation rate came in at
0.36% in December 2005, within market estimates and down from
0.55% posted in November 2005, AP relates.

Analysts said that the central bank will likely accelerate the
pace of rate cuts because of weak economic activity, AP states.
The inflation rate for 2005 was 5.69%, and, according to market
surveys released by the central bank, is seen at 4.6% in 2006.

The central bank's next interest rate announcement is scheduled
for March 8.



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C A Y M A N   I S L A N D S
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CUFRA CONSULTING: To Lay Accounts on Liquidation on February 6
--------------------------------------------------------------
                     Cufra Consulting Ltd.
                   (In Voluntary Liquidation)
               The Companies Law (2004 Revision)

Pursuant to section 145 of the Companies Law (2004 Revision),
the Final Meeting of the Shareholders of Cufra Consulting Ltd.
will be held at the office MBT Trustees (Cayman) Ltd, 3rd Floor,
Piccadilly Center, Elgin Avenue George Town, Grand Cayman,
Cayman Islands, on Feb. 6, 2006, at 12:00 noon.

Business:

1. To lay accounts before the meeting, showing how the winding
   up has been conducted and how the property has been disposed
   of, as at the final winding up on Feb. 6, 2006.

2. To authorize the liquidator to retain the records of the
   Company for a period of five years from the dissolution of
   the Company, after which they may be destroyed.

Proxies: Any person who is entitled to attend and vote is
entitled to appoint a proxy to attend and vote in his stead.  A
proxy need not be a member or creditor.

CONTACT:  Mr. Paolo Giacomelli, Voluntary Liquidator
          MBT Trustees Ltd.
          P.O. Box 30622 SMB, Grand Cayman
          Telephone: 945-8859
          Facsimile: 949-9793/4


EDGE INVESTMENT: Sets Final Meeting on February 16
--------------------------------------------------
              Edge Investment Offshore Fund, Ltd.
                  (In Voluntary Liquidation)
               The Companies Law (2004 Revision)

Notice is hereby given, pursuant to section 145 of the Companies
Law (2004 Revision) that the final extraordinary general meeting
of the shareholders of Edge Investment Offshore Fund, Ltd. will
be held at Grand Pavilion Commercial Centre, Suite # 7, 802 West
Bay Road, Grand Cayman, Cayman Islands, on Feb. 16, 2006, at
10:00 a.m. (Cayman time), for the purposes of:

Business

1. Having an account laid before the members showing the manner
   in which the winding-up has been conducted and the property
   of the Company disposed of, and of hearing any explanation
   that may be given by the liquidator; and

2. To authorize the liquidator to retain the records of the
   Company for a period of five years from the dissolution of
   the Company, after which they may be destroyed.

Proxies: Any person who is entitled to attend and vote at this
meeting may appoint a proxy to attend and vote in their stead. A
proxy need not be a member or a creditor.

CONTACT:  A.R.C. Directors Ltd., Sole Voluntary Liquidator
          PO Box 10250 APO
          Grand Pavilion Commercial Centre
          Suite # 7, 802 West Bay Road
          Grand Cayman, Cayman Islands
          Phone: 1 345 769 3400
          Fax: 1 345 769 3404


EDGE INVESTMENT: Showing Manner of Liquidation on February 16
-------------------------------------------------------------
               Edge Investment Master Fund, Ltd.
                  (In Voluntary Liquidation)
               The Companies Law (2004 Revision)

Notice is hereby given, pursuant to section 145 of the Companies
Law (2004 Revision) that the final extraordinary general meeting
of the shareholders of Edge Investment Master Fund, Ltd. will be
held at Grand Pavilion Commercial Centre, Suite # 7, 802 West
Bay Road, Grand Cayman, Cayman Islands, on Feb. 16, 2006, at
10:00 a.m. (Cayman time), for the purposes of:

Business

1. Having an account laid before the members showing the manner
   in which the winding-up has been conducted and the property
   of the Company disposed of, and of hearing any explanation
   that may be given by the liquidator; and

2. To authorize the liquidator to retain the records of the
   Company for a period of five years from the dissolution of
   the Company, after which they may be destroyed.

Proxies: Any person who is entitled to attend and vote at this
meeting may appoint a proxy to attend and vote in their stead. A
proxy need not be a member or a creditor.

CONTACT:  A.R.C. Directors Ltd., Sole Voluntary Liquidator
          PO Box 10250 APO
          Grand Pavilion Commercial Centre
          Suite # 7, 802 West Bay Road
          Grand Cayman, Cayman Islands
          Phone: 1 345 769 3400
          Fax: 1 345 769 3404


HAMILTON MULTI-STRATEGY: To Present Liquidation Accounts
--------------------------------------------------------
               Hamilton Multi-Strategy Fund, Ltd.
                  (In Voluntary Liquidation)
                The Companies Law (As Amended)

Pursuant to section 145 of the Companies Law (as amended), the
Final Meeting of the Shareholders of Hamilton Multi-Strategy
Fund, Ltd. will be held at the registered office of the Company
on Feb. 15, 2006, at 2.00 p.m.

Business:

1. To lay accounts before the meeting, showing how the winding
   up has been conducted and how the property has been disposed
   of, as at final winding up on Feb. 15, 2006.

2. To authorize the Liquidators to retain the records of the
   Company for a period of five years from the dissolution of
   the Company, after which they may be destroyed.

Proxies: Any person who is entitled to attend and vote at this
meeting may appoint a proxy to attend and vote in his stead. A
proxy need not be a member or a creditor.

CONTACT:  John Cullinane and Derrie Boggess
          Joint Voluntary Liquidators
          c/o Walkers SPV Limited
          Walker House, P.O. Box 908
          George Town, Grand Cayman


SURF CAPITAL: Schedules Final Meeting on February 9
---------------------------------------------------
                         Surf Capital
                  (In Voluntary Liquidation)
               The Companies Law (2004 Revision)
                         Section 145

NOTICE is hereby given pursuant to section 145 of the Companies
Law that the final general meeting of Surf Capital will be held
at the offices of Maples Finance Limited, Queensgate House,
George Town, Grand Cayman, Cayman Islands, on Feb. 9, 2006, for
the purpose of presenting to the members an account of the
winding up of the Company and giving any explanation thereof.

CONTACT:  Messrs. Murray McGregor and Jon Roney
          Joint Voluntary Liquidators
          Maples Finance Limited, P.O. Box 1093GT
          Grand Cayman, Cayman Islands.


===============
C O L O M B I A
===============


MINERCOL: Deadline to Liquidate Assets Moved to Dec. 31
-------------------------------------------------------
Business News Americas reports that Colombia's government has
postponed to Dec. 31, 2006, the deadline to liquidate national
mining company, Minercol.  The original deadline will expire on
January 28.

Some issues that need to be resolved include the finance and
public credit ministry's actuarial calculations, finishing
paperwork in order to transfer assets, and defining which
organization would manage Minercol's pensions, Business News
states.

The liquidation decree for Minercol was issued on Jan. 28, 2004.
Since then, Minercol has passed all its mining-related assets on
to Ingeominas, Colombia's mining and geology institute.

Minercol was created June 27, 1997, from the merger of Minerales
de Colombia and the Colombian Coal Company (Empresa Colombiana
de Carbon).


===================
C O S T A   R I C A
===================


* Government Investing US$660 Million for Diesel Generators
-----------------------------------------------------------
The government of Cuba has invested US$660 million to install
205 diesel-operated generators in the country.  The program aims
to improve the nation's electricity systems by reducing
blackouts and reliance on aging, expensive fuel-oil fired
thermoelectric plants, Business News reports.

President Fidel Castro said the country will be able to save up
to US$1 billion by installing the new generators and using other
alternative energy sources, Business News states.  Cuba's
national SEN grid has installed capacity to generate 3,000MW.

The government said that the generators will be operational by
May 1, 2006, resulting to 100% of Cuban families that receive
electricity will no longer need to consume kerosene or liquefied
petroleum gas at certain times of the day due to blackouts,
Castro said, Business News relates.

"The country will not build more [fuel-oil fired] thermoelectric
plants, that is history, it will build only combined cycle
plants using gas or plants using another kind of cheap fuel,"
President Castro was quoted saying, adding the government also
plans to install wind parks around the island.

Cuba has been receiving fuel assistance form Venezuela after
subsidies from the Soviet Union stopped arriving.  Venezuela's
state oil firm PDVSA provides Cuba with some 100,000 barrels a
day in crude and liquid fuels, including diesel for power
generation, while Cuba in turn sends teachers, doctors and other
advisors to Venezuela, Business News relates.


=============
J A M A I C A
=============


* NY Stock Exchange Executive Projects 3% GDP Growth This Year
--------------------------------------------------------------
Alex Ibrahim, a senior executive of the New York Stock Exchange,
said during a conference that global growth momentum will help
to move Jamaica towards three per cent growth in its gross
domestic product during the next fiscal year, which runs from
April 1, 2006 to March 31, 2007, the Jamaica Observer reports.

"Here in Jamaica the growth is expected to be slightly below
three per cent in 2006/2007," Mr. Ibrahim, who is managing
director of the Global Corporate Client Group, was quoted
saying. "Although small, this represents Jamaica's most rapid
economic expansion since the late 1980s."

Jamaica's economy grew by 6.8% in 1989, the last year under
Edward Seaga's administration of the 1980s.  The nation's
economy grew by 5.6% the following year under Michael Manley's
regime, the Observer relates.  Growth rate declined to 1% in
1991, and has never revived. Between January 1 and September 30,
2005, the growth was 1.1%.

"The global economy today is growing at its fastest pace in 30
years: five per cent in 2004, four per cent in 2005 and will
continue robust growth expected in 2006," said Mr. Ibrahim.
"Indeed, there is a world of unprecedented opportunities for
business industries and markets in every region of the world
including Jamaica and the Caribbean nations."

"The Caribbean needs to develop its capital market by first
moving to a level of regional integration that allows us to
develop the critical mass to attract international capital,"
said Roy Johnson, executive chairman of the Jamaica Stock
Exchange. "External equity investors are more interested in
investment across the region than companies operating in one
location."

Mr. Johnson argued that the Caribbean should recognize that it
was competing with markets with strong regional linkages, for
example, Latin America and Asia and "not only with the
sophisticated developed markets of New York, London and Tokyo,"
the Observer relates.

Jamaica has maintained its "B" rating for its long and short-
term sovereign debt by the prestigious Standard and Poor's
International Rating Agency.  S&P further said that the outlook
on the Jamaican economy remained stable.


===========
M E X I C O
===========


AXTEL: Investing US$150 Million to Fund Expansion in Five Cities
----------------------------------------------------------------
Axtel S.A. de C.V. plans to shell out US$150 million to launch
its telecommunication services in five new cities in Mexico this
year, Chief Executive Officer Tomas Milmo told Business News
Americas.

Axtel S.A. will be expanding in the northern cities of Chihuahua
and Torreon, the port of Veracruz as well as Irapuato and Celaya
in central Mexico, Business News reports.  The company already
provides services in Guadalajara, Puebla, Leon, Toluca,
Queretaro, San Luis Potosi, Aguascalientes, Saltillo, Tijuana,
Monterrey and Ciudad Juarez.

Axtel posted net profits of 306 million pesos (US$29 million)
for 2005 compared to a loss of 79.6 million pesos in 2004.

Axtel is one of the fastest growing fixed line telcos in Mexico.
It began trading on the BMV and the New York Stock Exchange in
December while Milmo told investors last month the company is
interested in acquiring one of its competitors, Avantel or
Alestra.

                        *    *    *

On Nov. 3, 2005, Standard & Poor's Ratings Services raised its
local and foreign currency corporate credit ratings on
Monterrey, Mexico-based Axtel S.A. de C.V. to 'B+' from 'B'. The
outlook was revised to positive from stable. The rating on
Axtel's US$250 million senior notes due 2013 was also raised to
'B+' from 'B'.


CFE: Inks Power Accord with CNFL and ICE
----------------------------------------
Mexican state power company CFE aka Comision Federal de
Electricidad signed a technical exchange agreement on Jan. 22
with Costa Rica's state-owned power distributor, CNFL, and
state-run electricity company, ICE, Business News Americas
reports.

Alfredo Elias, CFE's head, and Carlos Castro, the vice-president
of CNFL and ICE, signed the agreement in Mexico City.

Under the framework of the plan, Puebla-Panama will allow both
countries and the Central American region in general to benefit
from the technical cooperation between the three entities,
Business News relates.  The agreement includes the exchange of
technical information, training for workers as well as visits by
local experts for joint study and research projects.

According to Business News, Mexico and Costa Rica have been
working together for some time on electricity issues affecting
the region, so this agreement will allow them to help develop
energy projects that benefit the whole region.

CFE is a state-owned integrated power company that dominates
generation, transmission and distribution in Mexico.  It has
20.6 million clients, 39,182km of transmission infrastructure,
156,647MVA transformation capacity and 163 generation plants
that at end-March 2003 had 40,350MW combined capacity.  Seventy
five per cent of sales are direct to the client, 24.5% are to
Mexico City distributor Luz y Fuerza del Centro and the
remaining 0.5% are exports.  The industrial sector accounts for
61% of direct sales, followed by residential (23%), commercial
(7%), agriculture (5%) and services (4%).

The company suffered increasing losses for 2003 and 2004.  CFE
incurred MXN6.2 billion loss in 2003, and MXN119 billion loss in
2004.


TELMEX: Issuing 10-Year Peso Bonds on International Markets
-----------------------------------------------------------
Mexican fixed line giant Telefonos de Mexico S.A. aka Telmex
will issue 10-year peso-dominated bonds on international
markets, Business News Americas reports.

The bonds are reportedly payable in Mexican pesos or in US
dollars and are expected to be priced toward the middle of this
week.  Credit Suisse and Deutsche Bank are managing the deal.

This would be the second peso-dominated offering ever by a
Mexican company in international markets.


                        *    *    *

As reported in Troubled Company Reporter on March 9, 2005, court
No. 4 of Buenos Aires' civil and commercial tribunal declared
Telmex bankrupt, appointing Ms. Maria Lilia Orazi as the
trustee.


TELMEX: To Pay US$428,306 for Refusing SCE of Billing Details
-------------------------------------------------------------
Fixed line giant Telefonos de Mexico S.A., aka Telmex, has been
fined MXN4.5 million (US$428,306) by anti-monopoly commission
CFC for withholding billing details to Sistema Computarizado de
Emergencia, aka SCE, Business News Americas reports.

SCE, which operates an emergency phone service in
Nezahualcoyotl, Mexico state, went to CFC in 2003 with a
complaint that Telmex had refused to provide call charging
details, making it impossible for SCE to offer its service.

Telmex has lost an appeal against the fine, which was first
imposed late last year.

                        *    *    *

As reported in Troubled Company Reporter on March 9, 2005, court
No. 4 of Buenos Aires' civil and commercial tribunal declared
Telmex bankrupt, appointing Ms. Maria Lilia Orazi as the
trustee.


===========
P A N A M A
===========


AES CORP: AES Panama in Talks to Improve Condado Watershed
----------------------------------------------------------
AES Corp. subsidiary AES Panama, S.A. is in discussions with the
Autoridad Nacional del Ambiente to improve conditions on a
watershed adjacent to the Company's gas turbine plant at Condado
del Rey, in Panama.

As part of the discussions, the Company agreed to pay a fine of
US$250,000, and improve auditing and environmental management
plans at the plant.

On April 26, 2003, about 4,000 gallons of oil spilled as a
result of incorrect loading and storage tank value settings at
the plant. Remediation efforts were promptly conducted and
completed.

AES Corporation -- http://www.aes.com/-- is a leading global
power company, with 2004 revenues of $9.5 billion.  The Company
operates in South America, Europe, Africa, Asia and the
Caribbean countries.  AES generating 44,000 megawatts of
electricity
through 124 power facilities and delivers electricity through 15
distribution companies.  AES Corp.'s 30,000 people are committed
to operational excellence and meeting the world's growing power
needs.

                        *    *    *

As reported in the Troubled Company Reporter on Jan. 11, 2006,
Moody's affirmed the ratings of The AES Corporation, including
its Ba3 Corporate Family Rating and the B1 rating on its senior
unsecured debt.  The rating outlook remained stable.

As reported in the Troubled Company Reporter on June 23, 2005,
Fitch Ratings upgraded and removed the ratings of AES
Corporation from Rating Watch Positive, where it was initially
placed on Jan. 18, 2005, pending review of the company's year-
end financial results.  Fitch said the Rating Outlook was
Stable.


AES CORP: TermoAndes Arbitration Seeks US$10MM for Gas Supplies
---------------------------------------------------------------
An arbitration for the re-dollarization of TermoAndes S.A.'s gas
price in Argentina is seeking about US$10 million for past gas
supplies.

Since the beginning of 2002, AES Corp.'s subsidiary TermoAndes
S.A. has converted its obligations under its gas supply and gas
transportation contracts into pesos in accordance with the
pesofication established by the Public Emergency Law and related
decrees in Argentina.  Pursuant to the regulations, payments
must be made in Argentine pesos at a 1:1 exchange rate.

Gas suppliers Tecpetrol, Mobil and Compani0.a General de
Combustibles S.A. have objected to the payment in pesos.

On January 30, 2004, the gas suppliers presented a demand for
arbitration at the country's International Chamber of Commerce
requesting the re-dollarization of the gas price.

In October 2004, the case was submitted to a court of
arbitration for determination of the terms of reference.

The parties are in the process of submitting evidence to the
arbitrator.

AES Corporation -- http://www.aes.com/-- is a leading global
power company, with 2004 revenues of $9.5 billion.  The Company
operates in South America, Europe, Africa, Asia and the
Caribbean countries.  AES generating 44,000 megawatts of
electricity through 124 power facilities and delivers
electricity through 15 distribution companies.  AES Corp.'s
30,000 people are committed to operational excellence and
meeting the world's growing power needs.

                        *    *    *

As reported in the Troubled Company Reporter on Jan. 11, 2006,
Moody's affirmed the ratings of The AES Corporation, including
its Ba3 Corporate Family Rating and the B1 rating on its senior
unsecured debt.  The rating outlook remained stable.

As reported in the Troubled Company Reporter on June 23, 2005,
Fitch Ratings upgraded and removed the ratings of AES
Corporation from Rating Watch Positive, where it was initially
placed on Jan. 18, 2005, pending review of the company's year-
end financial results.  Fitch said the Rating Outlook was
Stable.


=====================
P U E R T O   R I C O
=====================


DORAL FINANCIAL: Gets Holders' Consent to Indenture Amendments
--------------------------------------------------------------
Doral Financial Corporation announced Monday that holders of a
majority of the outstanding principal amount of its $625,000,000
Floating Rate Senior Notes due 2007 have delivered consents to
proposed amendments to the related indenture and waivers of
certain defaults in the Company's Floating Rate Notes consent
solicitation.

In the Floating Rate Notes consent solicitation, the Company
sought and obtained the consent of holders to amendments to the
Indenture to allow it additional time to file with the trustee
its quarterly reports on Form 10-Q for the quarterly periods
ended March 31, 2005, June 30, 2005, and September 30, 2005, and
its annual report on Form 10-K for the fiscal year ended
December 31, 2005.

The Company sought and obtained waivers of certain defaults that
have occurred and that may occur under the Indenture.

The Company also announced the extension of the expiration date
for its consent solicitation relating to its $100,000,000 7.65%
Senior Notes due 2016, its $30,000,000 7.00% Senior Notes due
2012, its $40,000,000 7.10% Senior Notes due 2017 and its
$30,000,000 7.15% Senior Notes due 2022 from 5:00 p.m., New York
City time, on January 23, 2006, to 5:00 p.m., New York City
time, on January 26, 2006, unless further extended.  All other
terms and conditions of the Fixed Rate Notes consent
solicitation remain the same.

The Company is seeking similar amendments and waivers to the
Indenture in the Fixed Rate Notes consent solicitation as were
sought and obtained in the Floating Rate Notes consent
solicitation.

Doral Financial Corporation, a financial holding company, is the
largest residential mortgage lender in Puerto Rico, and the
parent company of Doral Bank, a Puerto Rico based commercial
bank, Doral Securities, a Puerto Rico based investment banking
and institutional brokerage firm, Doral Insurance Agency, Inc.
and Doral Bank FSB, a federal savings bank based in New York
City.


DORAL FIN'L: Inks Supplemental Indenture for Floating Rate Notes
----------------------------------------------------------------
Doral Financial Corporation disclosed that it executed a
supplemental indenture relating to its $625,000,000 Floating
Rate Senior Notes due 2007.  The supplemental indenture was made
in connection with the Company's consent solicitation of its
Floating Rate Notes.  The consent solicitation expired at 5:00
p.m., New York City time, on January 23, 2006.

Under the supplemental indenture, the company will have until
April 24, 2006, to file with the indenture trustee its quarterly
reports on Form 10-Q for the quarterly periods ended March 31,
2005, June 30, 2005, and September 30, 2005.  The company is
also given until May 24, 2006, to file its annual report on Form
10-K for the fiscal year ended December 31, 2005, before the
failure to file those reports becomes a default under the
Indenture that would allow holders to deliver a notice of
default to the trustee or the Company.

In the floating rate notes consent solicitation, the Company
sought and obtained the consent of holders to the amendments to
the Indenture, which amendments are effected by the supplemental
indenture.  The Company also sought and obtained waivers of
certain defaults that have occurred and that may occur under the
Indenture.  The amendments and waivers became effective upon
execution of the supplemental indenture on Tuesday at
approximately 1:00 p.m., New York City time.

According to the terms of the floating rate notes consent
solicitation, the Company paid a consent payment of $2.50 per
$1,000 principal amount of floating rate notes to holders that
consented prior to the expiration time.

Doral Financial Corporation, is holding company and the largest
residential mortgage lender in Puerto Rico.  Doral is the parent
company of Doral Bank, a Puerto Rico based commercial bank,
Doral Securities, a Puerto Rico based investment banking and
institutional brokerage firm, Doral Insurance Agency, Inc., and
Doral Bank FSB, a federal savings bank based in New York City.


MUSICLAND HOLDING: US Trustee Appoints 7-Member Creditors Panel
---------------------------------------------------------------
Pursuant to Section 1102(a)(1) of the Bankruptcy Code, Deirdre
A. Martini, the U.S. Trustee for Region 2, appointed seven
creditors to serve on the Official Committee of Unsecured
Creditors in Musicland Holding Corp., and its debtor-affiliates'
Chapter 11 cases:

    1. Deluxe Media Services, Inc.
       568 Atrium Drive
       Vernon Hills, IL 60061
       Tel: (201) 512-8757
       Attn: Curtis Roberts, Esq.

    2. Navarre Corporation
       7400 49th Avenue North
       New Hope, MN 55428
       Tel: (763) 971-2770
       Attn: Ryan F. Urness, Esq.

    3. Universal Studios Home Entertainment LLC
       100 Universal City Plaza 1440/6
       Universal City, CA 91608
       Tel: (818) 777-7601
       Attn: John Roussey, V.P. Credit Home Entertainment

    4. Ventura Distribution, Inc.
       2590 Conejo Spectrum Street
       Thousand Oaks, CA 91320
       Tel: (805) 498-7800
       Attn: William P. Clark

    5. Fender Musical Instruments Corporation
       8860 E. Chaparral Road, Suite 100
       Scottsdale, Arizona 85250-2610
       Tel: (480) 5696-7127
       Attn: Mark Van Vleet, Secretary and General Counsel

    6. Electronics Arts
       290 Redwood Shores Parkway
       Redwood City, CA 94065
       Tel: (650) 628-7304
       Attn: Norma Cash, Director, Shared Services

    7. Simon Property Group, LP
       115 W. Washington Street
       Indianapolis, IN 46204
       Tel: (317) 263-2346
       Attn: Ronald M. Tucker, Esq., VP/Bankruptcy Counsel

Official creditors' committees have the right to employ legal
and accounting professionals and financial advisors, at the
Debtors' expense.  They may investigate the Debtors' business
and financial affairs.

Importantly, official committees serve as fiduciaries to the
general population of creditors they represent.  Those
committees will also attempt to negotiate the terms of a
consensual Chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest.  If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management
with an independent trustee.  If the Committee concludes
reorganization of the Debtors is impossible, the Committee will
urge the Bankruptcy Court to convert the Chapter 11 cases to a
liquidation proceeding.

Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products.  The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064).  James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they
estimated more than $100 million in assets and debts.
(Musicland Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 215/945-7000)



=============
U R U G U A Y
=============


NUEVO BANCO: Advent International Agrees to Delay Sale Closing
--------------------------------------------------------------
Uruguay's central bank and US investment fund Advent
International agreed to delay until the first half of February
approval of Advent's purchase of Nuevo Banco Comercial aka NBC,
according to a report from the El Pais.

NBC was sold to Advent Int'l and a syndicate of lenders in
September last year for US$167 million.

Advent wants the sale completed by end of January but the bank's
board of directors asked for a 90-day extension of the approval
and handover.

The delay, El Pais says, was caused by a question on how much of
NBC's 451 million-peso profit in 2005 should go to the
government and how much will stay in the bank's coffers.

NBC was created in March 2003 from the assets of Banco
Comercial, Banco Montevideo and Banco Obrera.  The three banks
were suspended after a run on deposits during the financial
crisis that swept Uruguay in 2002.


=================
V E N E Z U E L A
=================


PDVSA: Aiming to Surpass Saudi Arabia's Oil Production
------------------------------------------------------
Venezuela's state-owned petroleum company, PDVSA, has announced
plans to reach crude oil production levels of 5.8 million
barrels per day by 2012 and 7.5 million barrels per day by 2020.
PDVSA also wants to invest $3 billion in expanding its refining
capacity.  It will form strategic alliances with numerous
countries in order to use refineries located in the Caribbean
and South America.  PDVSA will invest $56 billion between 2005
and 2012 to accomplish its goals.  Venezuela will pay 85% of
this investment with its own resources, and the remaining 15%
will come from private entities.  Venezuelan President Hugo
Chavez has divided this expansion project into two stages.  The
first phase will occur between 2005 and 2012, and the second
phase between 2012 and 2030.

PDVSA is hoping to turn Venezuela into the country with the most
crude oil reserves in the world, surpassing even Saudi Arabia.
Over the last few years, the Venezuelan petroleum industry has
been trying to increase its crude oil production since it is
estimated that Venezuela's crude oil reserves could be greater
than 77 billion barrels.

Venezuela initially attempted to become the world's oil
superpower in the 1990s, but the plan was abandoned in 1998 due
to a fall in oil prices.  However, lately the high price of oil,
uncertainty about worldwide oil reserves, increases in the
demand for energy, and recent initiatives to increase regional
integration in South America have convinced Venezuela that now
is the time to undertake an aggressive expansion project.

Boost in Production

During the first six months of 2005, Venezuela's oil production
reached 3,312,000 barrels per day.  Of this, 2,291,000 barrels
were supplied by the Venezuelan oil company and 352,000 barrels
were supplied by private companies.  Luis Vierma, PDVSA's Vice
President of Exploration and Production, has declared that PDVSA
hopes to increase production to as much as 4,019,000 barrels per
day by 2012, as well as generate 615,000 additional barrels per
day of new synthetic crude oil products in the Franja de Orinoco
region.  Vierma also stated that, in order to achieve these
goals, PDVSA will emphasize the recovery of oil from known
fields, accelerate exploration for natural gas within Venezuela,
and begin numerous new projects in Franja de Orinoco.

Moreover, Vierma indicated that there will be a need to
construct, adapt and improve Venezuela's entire petroleum
infrastructure, including refineries, terminals, oil pipelines,
and tanks.  The effort will be focused in the eastern portion of
the country where PDVSA estimates it can increase oil production
by 6.6 million barrels per day.  PDVSA will construct 21 tanks,
three new ports for oil transport, and 650 additional kilometers
of pipelines in this eastern region.  It is estimated that PDVSA
will need to spend $40.9 billion to support these exploration
and production activities.

Eulogio del Pino, a director of PDVSA, stated that PDVSA will
increase natural gas production from 6.3 billion cubic feet to
11.5 billion cubic feet.  The increases will be distributed as
follows:

   -- in Zulia production will increase from 1.1 billion cubic
      feet to 1.4 billion cubic feet,

   -- in Yucal Placer, in the center of the country, it will
      increase from 1 billion cubic feet to 3 billion cubic
      feet, and

   -- in Anaco the increase will be from 1.7 billion cubic feet
      to 2.8 billion cubic feet.

Moreover, the production of natural gas of the Proyecto Mariscal
Sucre (currently at about 1.2 billion cubic feet of production)
and the Plataforma Deltana (currently at 1 billion cubic feet of
production) will also be increased.

New Projects

Alejandro Granado, PDVSA's Vice President of Refining, explained
that Venezuela's petroleum industry will concentrate on
increasing crude oil processing capacity through the expansion
of existing refineries and investments in plants in the
Caribbean and South America.

Granado said PDVSA is considering spending $10.5 billion to
build three new Venezuelan refineries in Cabruta, Caripito, and
Barinas.  If they are built, processing capacity in Venezuela
will increase to 700,000 barrels per day.  Moreover, investments
in four of PDVSA's existing Venezuelan refineries could result
in an increase of processing of heavy and extra heavy crude oil
by 62%.  These investments would most affect the Paraguana
refinery.

Granado also explained that PDVSA has the intention to reach an
international processing capacity of 2.3 million barrels per day
by 2012.

Relations with Other Countries

Granado said that the governments of Venezuela and Cuba are
working together to reactivate the Cienfuegos refinery, which
will require an estimated $44 million investment.  Cienfuegos
has a processing capacity of 70,000 barrels per day, which is to
be used to meet the local fuel demand.

Venezuela and Jamaica are working on a project to expand the
capacity of the Kingston refinery to up to 50,000 barrels per
day.  They are planning to invest $197 million between 2006 and
2008 for this project.

Venezuela is also considering the possibility of processing
50,000 barrels per day from the La Franja de Orinoco region at
the La Teja refinery in Uruguay.  This project could be ready by
2011 and would require approximately $600 million in investment.

Granado also announced that Venezuela would construct the San
Jose Abreue Lima refinery in Brazil through its alliance with
Petrobras.  This $3 billion investment is expected in 2011, and
the refinery is expected to have a processing capacity of
200,000 barrels per day of crude oil coming from La Franja de
Orinoco and Brazilian oil fields.

There is also talk of possibly refining Venezuela's crude oil in
the Cartagena refinery in Colombia.  While at the same time,
PDVSA also wants to expand its market share in Chile and Peru.

Increase in PDVSA's Petroleum Transport Fleet

Asdrubal Chavez, PDVSA's internal director, announced that by
2012 PDVSA will have 58 tankers in its fleet.  These tankers
will carry 45% of the petroleum exported by Venezuela.

The building and maintenance of ships will occur via strategic
alliances with Argentina, Brazil, China, and Spain.  PDVSA will
spend an estimated $2.2 billion for the construction of 42 new
oil tankers.

Other Projects

President Chavez has also announced the Petroandina Initiative,
which includes the building of an oil pipeline from Venezuela to
the Pacific Ocean.  The pipeline will traverse Colombia.  This
will allow Venezuela to gain greater access to Asian Markets by
making oil transport faster and lowering freight costs.

Asdrubal said that PDVSA will use its plants in Aruba, Bonaire,
and Isla in Curazao as distribution centers to distant markets
such as China and India.  These centers have deep-water
terminals that are compatible with tankers that have the
capacity of holding 2 million barrels of oil.

On Jan. 23, 2005, Fitch Ratings has upgraded the local and
foreign currency ratings of Petroleos de Venezuela S.A. aka
PDVSA to 'BB-' from 'B+'.  The rating of PDVSA's export
receivable future flow securitization, PDVSA Finance Ltd, has
also been upgraded to 'BB+' from 'BB'.  In addition, Fitch has
assigned PDVSA a 'AAA(ven)' national scale rating.  The Rating
Outlook is Stable.  Both rating actions follow Fitch's November
2005 upgrade of Venezuela's sovereign rating.


PDVSA: Contributes US$22.3 Billion to State Coffers in 2005
-----------------------------------------------------------
PDVSA aka Petroleos de Venezuela S.A. contributed US$22.3
billion to the country's coffers in 2005, compared to a US$12
billion contribution in 2004, energy and oil minister and
company president Rafael Ramirez told reporters.  The agency's
average price for its crude was US$45.39 per barrel, higher than
the estimated US$23 per barrel price in its budget.

Despite the huge differential between the budgeted price and the
actual price in 2005, PDVSA reported no windfall revenue.

Mr. Ramirez disclosed that his company had paid US$13 billion in
royalties, US$8 billion in income tax and US$1.3 billion in
dividends to the company's sole shareholder, the Venezuelan
government.

PDVSA is Venezuela's state oil company in charge of the
development of the petroleum, petrochemical and coal industry,
as well as planning, coordinating, supervising and controlling
the operational activities of its divisions, both in Venezuela
and abroad.

On Jan. 23, 2005, Fitch Ratings has upgraded the local and
foreign currency ratings of Petroleos de Venezuela S.A. aka
PDVSA to 'BB-' from 'B+'.  The rating of PDVSA's export
receivable future flow securitization, PDVSA Finance Ltd, has
also been upgraded to 'BB+' from 'BB'.  In addition, Fitch has
assigned PDVSA a 'AAA(ven)' national scale rating.  The Rating
Outlook is Stable.  Both rating actions follow Fitch's November
2005 upgrade of Venezuela's sovereign rating.

                            ***********


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