TCRLA_Public/060718.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

         Tuesday, July 18, 2006, Vol. 7, Issue 141

                          Headlines

A R G E N T I N A

ACINDAR INDUSTRIA: S&P Argentina Rates US$100-Mil. Notes at raD
AGROIMPULSO CEREALES: Verification of Claims Ends on Oct. 10
ALPARGATAS: Restructuring Proposal Gets Comision Nacional's Okay
ALPARGATAS: Fitch Holds D Ratings Pending Restructuring Outcome
BLAZER SRL: Trustee Has Until Aug. 31 to Verify Proofs of Claim

BULONERA CONTE: Enters Bankruptcy on Court Orders
C.A. PRODUCCIONES: Trustee Will Verify Claims Until Aug. 25
CAIRIN SA: Claims Verification Deadline Is Set for Sept. 4
COLORIN INDUSTRIA: Moody's LatAm Rates US$47-Mil. Notes at D
EMPRESA DISTRIBUIDORA: Fitch Arg Rates US$150-Mil. Notes at D

FRIGORIFICO ALVARADO: Claims Verification Deadline Is on Sept. 5
IMAGEN: Fitch Arg Holds D Rating on Obligaciones Negociables
INDUSTRIAS METALURGICAS: Moody's LatAm Puts D Rating on Debt
LA CAPILLA: Seeks Court Approval to Reorganize Business
LEGEND SA: Last Day for Verification of Claims Is on Sept. 14

MASTELLONE HERMANOS: Moody's LatAm Places D Rating on US$7M Debt
ML GASTRONOMIA: Trustee Verifies Proofs of Claim Until Sept. 15
UNIPAC SA: Verification of Proofs of Claim Is Until Aug. 21

B E R M U D A

REFCO INC: Wants Court Approval on Fee Committee & Fee Protocol
REFCO INC: Inks Stipulation with Parties on Rule 2004 Motion
REFCO INC: Judge Drain Extends Removal Period to September 13

B O L I V I A

COUER D'ALENE: To Begin Construction of San Bartolome Project

B R A Z I L

ALERIS INT'L: Gets Requisite Consents on Tender Offer of Notes
ALERIS INTERNATIONAL: S&P Affirms BB- Corporate Credit Rating
COMPANHIA SIDERURGICA: Gets Antitrust Clearance in Lusosider Buy
NALCO CO: Fitch Upgrades Sr. Notes' Rating to BB from B+
VARIG SA: Creditors Voted Against Volo's US$500-Million Offer

VOLKSWAGEN AG: Cutting Up to 6,000 Jobs in Brazilian Plants

* BRAZIL: Loans US$100MM to Jamaica to Revive Sugar Industry

C A Y M A N   I S L A N D S

ALTEDGE ADVISORS: Proofs of Claim Filing Is Until July 25
EQUALT FEEDER: Last Day to File Proofs of Claim Is on July 31
HIGHLAND GLOBAL MASTER: Proofs of Claim Filing Is Until Aug. 10
HIGHLAND GLOBAL SPC: Claims Filing Deadline Is Set for Aug. 10
INTEGRO HOLDINGS: Deadline for Claims Filing Is Set for Aug. 4

MERRILL LYNCH: Creditors Must File Proofs of Claim by Aug. 10
NOTTINGHAM LIMITED: Creditors Have Until Aug. 10 to File Claims
PEYPER INVESTMENTS: Proofs of Claim Must be Filed by Aug. 10
ULYSSES FUND: Claims Filing Deadline Is Set for July 31
VICTORIA HOLDINGS: Proofs of Claim Filing Is Until Aug. 10

C H I L E

SHAW GROUP: Incurs US$16.7 Mil. Net Loss in Third Quarter 2006

C O L O M B I A

BANCOLOMBIA: Inks Letter of Intent With Portal to Sell Almacenar
HEXION SPECIALTY: Swapping US$150M of Notes for Registered Bonds

* COLOMBIA: NatGas Pipeline to Include Fiber Optic Cable

D O M I N I C A N   R E P U B L I C

FALCONBRIDGE: Inco & Phelps Dodge Increase Merger Offer

E C U A D O R

* ECUADOR: Plans to Auction Oil from Former Occidental Fields

E L   S A L V A D O R

* EL SALVADOR: S&P Assigns BB+ Senior Unsecured Debt Rating

J A M A I C A

KAISER ALUMINUM: Court Allows MAXXAM to Sell Up to 3.5MM Shares
KAISER ALUMINUM: Wants Orricks Herrington's Payment Denied

* JAMAICA: In Talks With Brazil to Re-Establish Sugar Industry

M E X I C O

FORD MOTOR: Moody's Lowers Corp. Family & Sr. Unsecured Ratings
GENERAL MOTORS: Held Exploratory Talks With Nissan & Renault
GRUPO IUSACELL: Unit Concludes Debt Restructuring With BNP
SECUNDA INT'L: Declares Pricing Terms on Sr. Notes Tender Offer

N I C A R A G U A

* NICARAGUA: Mayor Encourages President to Buy Venezuelan Oil

P A N A M A

BANCO LATINAMERICANO: Launches Operations of Clavex LLC
SOLO CUP: Susan H. Marks Resigns as Chief Financial Officer

* PANAMA: Trans-Caribbean Pipeline to Include Fiber Optic Cable

P A R A G U A Y

* PARAGUAY: Foreign Bond Issues May be Bought by Venezuela

P U E R T O   R I C O

ADELPHIA COMMS: GE Capital Wants Mercury to Decide on Contract
ADELPHIA COMMS: JPMorgan Will Appeal Comcast-Time Warner Sale OK
MAXXAM INC: Can Sell Up to 3.5 Million Kaiser Aluminum Shares

V E N E Z U E L A

PETROLEOS DE VENEZUELA: Affirms Intent to Refine Ecuadorian Oil
PETROLEOS DE VENEZUELA: Inks Eight Joint Venture Agreements

* VENEZUELA: Natural Gas Pipeline to Include Fiber Optic Cable
* VENEZUELA: Remedies Natural Gas Shortage Through Pipeline
* VENEZUELA: Saving US$40MM Monthly in Natural Gas Imports


                          - - - - -


=================
A R G E N T I N A
=================


ACINDAR INDUSTRIA: S&P Argentina Rates US$100-Mil. Notes at raD
---------------------------------------------------------------
The Argentine arm of Standard & Poor's rated Acindar Industria
Argentina de Aceros' US$100 million Obligaciones Negociables
Simples due Dec. 16, 2004, at raD.  The rating action is based
on the company's financial status at Mar. 31, 206.


AGROIMPULSO CEREALES: Verification of Claims Ends on Oct. 10
------------------------------------------------------------
Jorge Blazquez, the court-appointed trustee for Agroimpulso
Cereales S.A.'s reorganization proceeding, will verify
creditors' proofs of claim until Oct. 10, 2006.

On Aug. 1, 2007, Agroimpulso Cereales' creditors will vote on a
settlement plan that the company will lay on the table.

Court No. 9 in Buenos Aires approved Agroimpulso Cereales'
petition to reorganize its business after cessation of debt
payments on Dec. 21, 2004.

Clerk NO. 17 assists the court in the case.

The debtor can be reached at:

    Agroimpulso Cereales S.A.
    Tucuman 810
    Buenos Aires, Argentina

The trustee can be reached at:

    Jorge Blazquez
    Fray Justo Santa Maria de Oro 2381
    Buenos Aires, Argentina


ALPARGATAS: Restructuring Proposal Gets Comision Nacional's Okay
----------------------------------------------------------------
On July 11 the Bolsa de Comercio and the Comision Nacional de
Valores approved the proposal presented by the creditors of
Alpargatas for restructuring its ARS504 million debt.  The
shareholders of Alpargatas increased 1.35% to US$5.25 each
share.  The court in charge of the restructuring is Juzgado
Comercial Number 19, with assistance from Secretaria 37.

The company's creditors have 5 days to decide whether they'll
accept or reject the proposal.  If creditors will reject the
plan, it could result to a further delay for another five
months.  The proposed sale of Alpargatas to Camargo Correa could
also be delayed.

                      About Alpargatas

Created in 1883, Alpargatas S.A.I.C. is a group of companies
which participate in the textile sector having well recognized
brands.  The shares of the company are located between creditors
who capitalized their credits in 2000 and minor shareholders in
the Buenos Aires stock market, with participations for no more
than 20%.

Alpargatas filed for the local equivalent of the United States'
Chapter 11 bankruptcy in December 2001 and presented its debt
restructuring offer in court in March 2004.


ALPARGATAS: Fitch Holds D Ratings Pending Restructuring Outcome
---------------------------------------------------------------
Fitch Argentina Calificadora de Riesgo SA assigned these ratings
on Alpargatas SAIC's debts:

   -- Obligaciones Negociables Convertibles for US$70 million
      (US$6.2 milion in circulation),

   -- Obligaciones Negociables Convertibles for US$5.1 million
      (US$40.898 in circulation),

   -- Obligaciones Negociables Sub. Convertibles, for US$80
      million (US$5.9 million in circulación),

   -- Obligaciones Negociables for US$40 million (US$13.4
      million in circulation), and

   -- Obligaciones Negociables Simples Class A for US$1 million
      and Class B for US$80 million.

The ordinary shares have been placed under category 4.

After having opened the Concurso Preventivo in Dec. 2005,
Alpargatas reached the Acuerdo Preventivo de Acredores, accepted
by creditors holding 87.72% of the total debt.  The company has
also reached pre-financing agreements with Banco Nacion and
Banco de la Provincia de Buenos Aires.  Fitch Argentina
considers positive the progress in the concurso process, being
conscious as well that the approval of the acuerdo preventivo is
of vital importance for the development of the operations in the
long term.

The incomes of Alpargatas at the close of the 2006 quarter
showed a 23.6% growth compared to the same period of 2005,
showing a positive trend in relation to the operations of the
company because of the recovery in the sector.  In March 2006,
the good operating results translated in income for US$17.5
million which allowed the company to fund investments of US$5.1
million and decrease its debt in concurso in US$3.7 million.

Created in 1883, Alpargatas S.A.I.C. is a group of companies
dedicated to the textile sector and the production of shoes and
trainors.  The shares of the company are distributed between
creditors who capitalized credits in 2000 and minor shareholders
from the Bolsa de Comercio de Buenos Aires, with no
participations for more than the 30%.


BLAZER SRL: Trustee Has Until Aug. 31 to Verify Proofs of Claim
---------------------------------------------------------------
Guido Maria Salvadori, the court-appointed trustee for Blazer
S.R.L.'s bankruptcy case will verify creditors' proofs of claim
until Aug. 31, 2006.

Creditors who fail to submit proofs of their claims won't
receive any post-liquidation distribution that Mr. Salvadori
will make.

La Nacion relates that Court No. 6 in Buenos Aires declared
Blazer S.R.L. bankrupt at the request of Claudia Nunez, whom it
owes US$2,956.

Clerk No. 12 assists the court in this case.

The debtor can be reached at:

    Blazer S.R.L.
    Andres Lamas 1950
    Buenos Aires, Argentina

The trustee can be reached at:

    Guido Maria Salvadori
    Junin 55
    Buenos Aires, Argentina


BULONERA CONTE: Enters Bankruptcy on Court Orders
-------------------------------------------------
Bulonera Conte S.A. enters bankruptcy protection after a court
in Venado Tuerto, Santa Fe, ordered the company's liquidation.
The order transfers control of the company's assets to Guillermo
Poli, the court-appointed trustee who will supervise the
liquidation proceeding.

Mr. Guilermo Poli will verify creditors' proofs of claim against
Bulonera Conte.  Under Argentine bankruptcy law, Mr. Poli will
provide the court with individual reports and a general report
containing an audit of the company's accounting and business
records after the claims are verified.  The report submission
dates have not been disclosed.

The debtor can be reached at:

    Bulonera Conte S.A.
    Mitre 1701, Venado Tuerto
    Santa Fe, Argentina

The trustee can be reached at:

    Guillermo Poli
    Belgrano 672, Venado Tuerto
    Santa Fe, Argentina


C.A. PRODUCCIONES: Trustee Will Verify Claims Until Aug. 25
-----------------------------------------------------------
Court-appointed trustee Liliana Beatriz Rodriguez will verify
creditors' proofs of claim against bankrupt company C.A.
Producciones Publicitarias S.R.L., fka R. Leslie Ramsay S.R.L.,
until Aug. 25, 2006.

Creditors who fail to present their proofs of claims won't
receive any post-liquidation distribution that Ms. Rodriguez
will make.

The verified claims will be presented in court as individual
reports on Oct. 20, 2006.  A general report that contains an
audit of C.A. Producciones' accounting and banking records will
follow on Dec. 15, 2006.

The debtor can be reached at:

    C.A. Producciones Publicitarias S.R.L.
    Santiago del Estero 286
    Buenos Aires, Argentina

The trustee can be reached at:

    Liliana Beatriz Rodriguez
    San Martin 66
    Buenos Aires, Argentina


CAIRIN SA: Claims Verification Deadline Is Set for Sept. 4
----------------------------------------------------------
Hector Bazzini, the court-appointed trustee for Cairin S.A.'s
bankruptcy proceeding, will verify creditors' proofs of claim
until Sept. 4, 2006.

Creditors who fail to submit proofs of their claims won't
receive any post-liquidation distribution that Mr. Bazzini will
make.

Court No. 13 in Buenos Aires declared Cairin S.A. bankrupt at
the behest of Owen Corning Fiberglas A.S. Ltda.

Clerk No. 26 assists the court in this case.

The debtor can be reached at:

    Cairin S.A.
    Unanue 6082
    Buenos Aires, Argentina

The trustee can be reached at:

    Hector Bazzini
    Uruguay 662
    Buenos Aires, Argentina


COLORIN INDUSTRIA: Moody's LatAm Rates US$47-Mil. Notes at D
------------------------------------------------------------
Colorin Industria de Materiales Sintet's US$47 million
Obligaciones Negociables is rated D by Moody's Latin America.
The rating action is based on the company's financial status at
Mar. 31, 2006.


EMPRESA DISTRIBUIDORA: Fitch Arg Rates US$150-Mil. Notes at D
-------------------------------------------------------------
Empresa Distribuidora de Electricidad de Mendoza S.A.
Obligaciones Negociables simples for US$150 million is rated D
by the Argentine arm of Fitch Ratings.  The debt was in default
since April 13, 2005.  The rating action is based on the
company's financial status at Mar. 31, 2006.


FRIGORIFICO ALVARADO: Claims Verification Deadline Is on Sept. 5
----------------------------------------------------------------
Court-appointed trustee Hector Ricardo Martinez will verify
creditors' proofs of claim against bankrupt company Frigorifico
Alvarado S.A. until Sept. 5, 2006.

Creditors who fail to present their proofs of claims won't
receive any post-liquidation distribution that Mr. Martinez will
make.

The verified claims will be submitted in court as individual
reports on Oct. 18, 2006.  A general report that contains an
audit of Frigorifico Alvarado's accounting and banking records
will follow on Nov. 29, 2006.

The trustee can be reached at:

    Hector Ricardo Martinez
    Avenida Independencia 2251
    Buenos Aires, Argentina


IMAGEN: Fitch Arg Holds D Rating on Obligaciones Negociables
------------------------------------------------------------
Fitch Argentina Calificadora de Riesgo SA maintained its D
rating on Imagen Satelital SA's Obligaciones Negociables.

The rate was given after the company failed to restructure the
debt.  From an operational point of view, the company has a
strong competitive position within the Argentine cable TV sector
if considering the experience of its shareholder and the
management of the companies of the group.

The increase in equity, the economical and financial future of
the company will depend greatly in the investment that the
shareholders will make and in the capacity of Imagen to generate
income from the recomposition of its equity.  In relation to
this matter, the company has signed a comittment with Claxson,
in which it makes sure that Imagen will recover its capital in
order to avoid being dissolved.

In Dec. 2005, Imagen continued with a strong recovery on the
level of its income, and on its operations.  At this time, net
sales reached US$107.4 million, a 27% increase compared to 2004.
This came together with recoveries in the operational level,
which measured as EBITDA reached to 36.9% in Dec. 2005.  In
March 2006, this trend continued, both at its rent and income
levels.

During 2005, the generation of funds allowed Imagen to face its
financial commitments.  In Dec 2005, Imagen made payments to
Claxson for US$4.9 million.  In the first quarter of 2006, the
company made payments to Claxson for US$830 million.

Imagen Satelital S.A. is one of the main cable TV distributors
in South America.  It operates 11 TV channels.  Its main source
of income is subscriptions (72% of the 2005 sale).  CTG
Inversora (branch of Claxson Interactive Group, rated with B- by
Fitch) controls 96% of the company, the rest is in the hands of
El Sitio.


INDUSTRIAS METALURGICAS: Moody's LatAm Puts D Rating on Debt
------------------------------------------------------------
Moody's Latin America rated Industrias Metalurgicas Pescarmona's
US$150 million bond issuance under its US$250 million global
program at D.  The unpaid debt since May 20, 2002, amounts to
US850,000.  The rating action is based on the company's
financial standing at April 30, 2006.


LA CAPILLA: Seeks Court Approval to Reorganize Business
-------------------------------------------------------
Court No. 18 in Buenos Aires is studying the merits of La
Capilla S.A.'s petition to reorganize its business.  The company
filed the "Concurso Preventivo" petition after defaulting on its
debt payments on Feb. 23, 2005.

The petition, once approved by the court, will allow La Capilla
to negotiate a settlement with its creditors in order to avoid a
straight liquidation.

Clerk No. 36 assists the court in this case.

The debtor can be reached at:

    La Capilla S.A.
    Virrey Ceballos 209
    Buenos Aires, Argentina


LEGEND SA: Last Day for Verification of Claims Is on Sept. 14
-------------------------------------------------------------
Court-appointed trustee Maria Marta Porolli will verify
creditors' proofs of claim against Legend S.A. until
Sept. 14, 2006.  Court No. 4 in Buenos Aires declared that the
company's bankruptcy case must be converted into a
reorganization proceeding.

Under insolvency protection, Legend S.A. is allowed to negotiate
a settlement with its creditors in order to avoid a straight
liquidation.

The Troubled Company Reporter-Latin America reported on
June 13, 2006, that Legend S.A. was plunged into bankruptcy at
the behest of Carrefour Argentina S.A., which it owes
US$60,962.52.

Clerk No. 8 assists the court in the proceeding.

The debtor can be reached at:

    Legend S.A.
    Alsina 1170
    Buenos Aires, Argentina

The trustee can be reached at:

    Maria Marta Porolli
    Tucuman 1455
    Buenos Aires, Argentina


MASTELLONE HERMANOS: Moody's LatAm Places D Rating on US$7M Debt
----------------------------------------------------------------
Moody's Latin America assigned a D rating on Mastellone Hermanos
S.A.'s US$7.091 million Obligaciones Negociables.  The rating
action is based on the company's financil status at
Mar. 31, 2006.


ML GASTRONOMIA: Trustee Verifies Proofs of Claim Until Sept. 15
---------------------------------------------------------------
Beatriz Rosa Mazzaferri, the court-appointed trustee for ML
Gastronomia S.R.L.'s bankruptcy case, will verify creditors'
proofs of claim until Sept. 15, 2006.

Creditors who fail to submit proofs of their claims won't
receive any post-liquidation distribution that Ms. Mazzaferri
will make.

La Nacion relates that Court No. 4 in Buenos Aires declared ML
Gastronomia bankrupt at the behest of Jorge Fioretti, whom it
owes US$6,132.72.

Clerk No. 7 assists the court in this case.

The debtor can be reached at:

    ML Gastronomia S.R.L.
    La Rioja 951
    Buenos Aires, Argentina

The trustee can be reached at:

    Beatriz Rosa Mazzaferri
    Lavalle 1459
    Buenos Aires, Argentina


UNIPAC SA: Verification of Proofs of Claim Is Until Aug. 21
-----------------------------------------------------------
Court-appointed trustee Francisco Salles Calvet will verify
creditors' proofs of claim against bankrupt company Unipac S.A.
until Aug. 21, 2006.

Creditors who fail to present their proofs of claims won't
receive any post-liquidation distribution that Mr. Calvet will
make.

Argentine bankruptcy law requires Mr. Calvet to present
individual reports and a general report that contains an audit
of Unipac's accounting and banking records after the
verification of claims.  The report submission dates have not
been disclosed.

The debtor can be reached at:

    Unipac S.A.
    Charcas 3180
    Buenos Aires, Argentina

The trustee can be reached at:

    Francisco Salles Calvet
    Avenida Corrientes 1515
    Buenos Aires, Argentina




=============
B E R M U D A
=============


REFCO INC: Wants Court Approval on Fee Committee & Fee Protocol
---------------------------------------------------------------
Refco Inc. and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Southern District of New York to appoint a fee
committee and approve their proposed fee protocol, pursuant to
Section 331 of the US Bankruptcy Code.

The Fee Committee will review fee statements submitted by all
professionals retained in the Debtors' Chapter 11 cases for
overall reasonableness and fairness.  The Fee Committee will
also review all future interim and final fee applications.

The Fee Committee will reign in the professional costs in the
Chapter 11 cases, Sally McDonald Henry, Esq., at Skadden, Arps,
Slate, Meagher & Flom LLP, in New York, explains.

As previously reported, 11 bankruptcy professionals have filed
first interim fee applications seeking payment of more than
US$33,000,000 in fees and expenses.  Due to cash collateral
constraints in the cases of most of the Debtors, the U.S.
Trustee has noted that US$2,774,275 has been paid to four
professionals.

The Fee Protocol details the Debtors' proposal with respect to:

   (a) the purposes for establishing the Fee Committee;

   (b) the composition of the Fee Committee;

   (c) compensation of certain Fee Committee members;

   (d) budget procedures;

   (e) procedures for identifying and potentially resolving fee
       disputes;

   (f) limitations on the Fee Committee's authority; and

   (g) exculpation and indemnification provisions for the Fee
       Committee members in connection with their performance of
       duties on the Fee Committee's behalf.

The Fee Committee will consist of:

   1.  Harrison J. Goldin, the Debtors' chief executive officer;

   2.  Marc S. Kirschner, the Chapter 11 Trustee of Refco
       Capital Markets, Ltd.;

   3.  one member appointed by and representative of the
       Official Committee of Unsecured Creditors, who is not
       primarily a creditor of RCM; and

   4.  one person appointed by and representative of the United
       States Trustee.

As requested by the U.S. Trustee, its representative will be a
non-voting member.

In the event a Fee Committee member resigns, the constituent
group represented by that member may designate a successor
member.  The Court may alter the membership of the Fee Committee
at any time.

Messrs. Goldin and Kirschner and the representative of the U.S.
Trustee will not be paid for their services.  The other
Committee member will receive US$2,000 for each in-person
meeting attended and US$500 for each substantive teleconference
meeting.  All Fee Committee members will be entitled to
reimbursement for reasonable, documented out-of-pocket costs and
expenses from the estates.

               Fee Application Review Process

Pursuant to the Fee Protocol, the Debtors propose to require
each Retained Professional to prepare a budget of the
professional fees it expects to incur over the course of each
four-month fee application period.  The budget will include, in
reasonable detail, the services anticipated to be provided over
the application period.  To the extent actual fees exceed 25%
over the budgeted fees, the Retained Professional are required
to explain the discrepancy.

After reviewing the fee statements and applications, the Fee
Committee will question any deviations from the budgets
submitted or from the billing guidelines developed by the Fee
Committee.  Where appropriate, the Fee Committee will negotiate
with the Retained Professionals regarding their bills.

The Fee Committee will also generate reports, noting disputes
the Fee Committee has with any Retained Professional's fees,
which were unable to be resolved.  The reports will be made
available to the Court and appropriate parties-in-interest. The
Fee Committee will not have standing on its own to object to the
fees sought by Retained Professionals.

                         Fee Examiner

The Fee Committee may retain a fee examiner, subject to Court
approval.  The costs of the fee examiner will be reimbursed by
the Debtors' estates.

The fee examiner's role would be limited to providing
quantitative analysis of individual fee applications for the Fee
Committee's review and consideration, but any recommendations or
determinations regarding reasonableness or whether to dispute a
fee statement or application would be determined solely by the
Fee Committee after providing the Retained Professional with an
opportunity to respond to the Fee Committee's concerns.

             Chapter 7 Professionals Not Included

The professionals retained by the Chapter 7 trustee for services
to Refco LLC are not subject to the Fee Protocol.  Additionally,
in the event the Chapter 11 case of RCM is converted to a case
under Chapter 7 of the Bankruptcy Code, the Chapter 11 Trustee
will resign from the Fee Committee and the Fee Protocol will no
longer apply to RCM's Retained Professionals.

                      About Refco Inc.

Based in New York, Refco Inc. -- http://www.refco.com/-- is a
diversified financial services organization with operations in
14 countries and an extensive global institutional and retail
client base.  Refco's worldwide subsidiaries are members of
principal U.S. and international exchanges, and are among the
most active members of futures exchanges in Chicago, New York,
London and Singapore.  In addition to its futures brokerage
activities, Refco is a major broker of cash market products,
including foreign exchange, foreign exchange options, government
securities, domestic and international equities, emerging market
debt, and OTC financial and commodity products.  Refco is one of
the largest global clearing firms for derivatives.

The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts.  Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors.  Refco
reported US$16.5 billion in assets and US$16.8 billion in debts
to the Bankruptcy Court on the first day of its chapter 11
cases.

Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134).  Refco, LLC,
is a regulated commodity futures company that has businesses in
the United States, London, Asia and Canada.  Refco, LLC, filed
for bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc.  Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.

On April 13, 2006, the Court appointed Marc S. Kirschner as
Refco Capital Markets Ltd.'s chapter 11 trustee.  Mr. Kirschner
is represented by Bingham McCutchen LLP.  RCM is Refco's
operating subsidiary based in Bermuda.

Three more affiliates of Refco, Westminster-Refco Management
LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC,
filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-11260 through 06-11262).  (Refco Bankruptcy News,
Issue No. 34; Bankruptcy Creditors' Service, Inc., 215/945-
7000).


REFCO INC: Inks Stipulation with Parties on Rule 2004 Motion
------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in
Refco, Inc., and its debtor-affiliates cases, asked the U.S.
Bankruptcy Court for the Southern District of New York to compel
22 respondents to produce documents on or before the date that
is 30 days after a corresponding subpoena is served.

The 22 respondents are:

   * Arthur Anderson, LLP;
   * Delta Flyer Fund, LLC/Eric M. Flanagan;
   * Micky Dhillon & the Jasdeep Dhillon Trustee MSD Family
     Trust;
   * Thomas Dittmer;
   * Ernst & Young LLP;
   * Stephen Grady;
   * Thomas Hackl;
   * Ingram Micro Inc.;
   * Mark Kavanagh;
   * Dennis Klejna;
   * Levine Jacobs and Co. LLC;
   * Eric Lipoff;
   * McDermott Will & Emery;
   * Joseph Murphy;
   * Frank Mutterer;
   * Victor Niederhoffer/Niederhoffer Investments Inc.;
   * Sean O'Shea and Edward McElwreath;
   * PricewaterhouseCoopers, LLP;
   * William M. Sexton;
   * Philip Silverman;
   * Chris Sugrue; and
   * David Weaver.

The Committee discloses that, subject to the Rule 2004 Discovery
Motion, it entered into stipulations with:

(1) Dennis Klejna

Dennis Klejna was general counsel of Refco, Inc., and Refco
Group Ltd., LLC.  Mr. Klejna is no longer employed by the
Debtors and does not yet know what responsive documentation he
will have, if any.

Mr. Klejna has no objection to the document request so long as
certain unique issues regarding the Debtors' attorney-client
privilege are resolved.  He notes that the Debtors may wish to
assert attorney-client privilege as to some or all of the
subpoenaed documents.

The Creditors Committee is willing to permit the Debtors to have
a limited additional period to review documents to determine
whether an assertion of privilege is appropriate.

In a Court-approved stipulation, the Committee agrees that Mr.
Klejna will have 20 days after service of subpoena to produce
documents to either the Committee or the Debtors, through the
Debtors' counsel, with notice to Committee.  The Debtors will
have 15 additional days to determine whether or not to assert
attorney-client privilege as to any of the documents.

To the extent that the Debtors do not assert a privilege, the
Debtors agree to promptly transmit the documents to the
Committee.  To the extent that the Debtors assert a privilege,
they will be responsible for any appropriate filings or
responses to preserve or assert it -- with notice to Mr. Klejna
-- and will be responsible for providing the documents to the
Committee if so required as a result of any ruling on the
privilege issue.

Mr. Klejna will continue to have the same rights as all other
Respondents to assert objections to the subpoenas, all rights
being expressly preserved.

(2) Niederhoffer

The Creditors Committee agrees to withdraw its Rule 2004 Motion
insofar as it seeks discovery from Victor Niederhoffer and
Niederhoffer Investments Inc.  The Committee waives no rights or
positions.

In the event that the Committee resubmits a motion for Rule 2004
discovery seeking permission to obtain discovery from
Niederhoffer, Niederhoffer reserves the right to object to that
request.

                        PwC Responds

PricewaterhouseCoopers LLP does not object to the document
request.  PwC, however, needs at least 60 days to produce the
documents the Committee wants.  PwC expects that it will be able
to work through to a reasonable solution of the issues with the
Committee's counsel.

                      About Refco Inc.

Based in New York, Refco Inc. -- http://www.refco.com/-- is a
diversified financial services organization with operations in
14 countries and an extensive global institutional and retail
client base.  Refco's worldwide subsidiaries are members of
principal U.S. and international exchanges, and are among the
most active members of futures exchanges in Chicago, New York,
London and Singapore.  In addition to its futures brokerage
activities, Refco is a major broker of cash market products,
including foreign exchange, foreign exchange options, government
securities, domestic and international equities, emerging market
debt, and OTC financial and commodity products.  Refco is one of
the largest global clearing firms for derivatives.

The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts.  Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors.  Refco
reported US$16.5 billion in assets and US$16.8 billion in debts
to the Bankruptcy Court on the first day of its chapter 11
cases.

Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134).  Refco, LLC,
is a regulated commodity futures company that has businesses in
the United States, London, Asia and Canada.  Refco, LLC, filed
for bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc.  Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.

On April 13, 2006, the Court appointed Marc S. Kirschner as
Refco Capital Markets Ltd.'s chapter 11 trustee.  Mr. Kirschner
is represented by Bingham McCutchen LLP.  RCM is Refco's
operating subsidiary based in Bermuda.

Three more affiliates of Refco, Westminster-Refco Management
LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC,
filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-11260 through 06-11262).  (Refco Bankruptcy News,
Issue No. 34; Bankruptcy Creditors' Service, Inc., 215/945-
7000).


REFCO INC: Judge Drain Extends Removal Period to September 13
-------------------------------------------------------------
The Honorable Robert D. Drain of the U.S. Bankruptcy Court for
the Southern District of New York extended to Sept. 13, 2006,
the time within which Refco Inc. and its debtor-affiliates may
file notices of removal pursuant to Rule 9006(b) of the Federal
Rules of Bankruptcy Procedure.

As reported in the Troubled Company Reporter on June 28, 2006,
the Debtors told the Court that the request has the consent of
Marc S. Kirschner, the Chapter 11 trustee of the estate of Refco
Capital Markets, Ltd.

Prior to filing for bankruptcy, the Debtors were plaintiffs in
approximately 37 actions and proceedings in a variety of state
and federal courts throughout the country.

Sally McDonald Henry, Esq., at Skadden, Arps, Slate, Meagher &
Flom, LLP, in New York, relates that the Debtors have not yet
reviewed all the Actions to determine whether any Actions should
be removed.  The Debtors have continued to focus primarily on
stabilizing and maximizing the value of the wind-down of their
businesses.

The RCM trustee also needs additional time to evaluate the
Actions to determine whether they should be removed.

Moreover, the Debtors and the RCM Trustee are engaged in a
bankruptcy plan formulation process, which may impact decisions
with respect to the Actions.

Ms. Henry asserts that extension of the Removal Period will
afford the Debtors sufficient opportunity to assess whether the
Actions can and should be removed, thus, protecting the Debtors'
valuable right to adjudicate lawsuits under 28 U.S.C. Section
1452.

                       About Refco Inc.

Based in New York, Refco Inc. -- http://www.refco.com/-- is a
diversified financial services organization with operations in
14 countries and an extensive global institutional and retail
client base.  Refco's worldwide subsidiaries are members of
principal U.S. and international exchanges, and are among the
most active members of futures exchanges in Chicago, New York,
London and Singapore.  In addition to its futures brokerage
activities, Refco is a major broker of cash market products,
including foreign exchange, foreign exchange options, government
securities, domestic and international equities, emerging market
debt, and OTC financial and commodity products.  Refco is one of
the largest global clearing firms for derivatives.

The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts.  Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors.  Refco
reported US$16.5 billion in assets and US$16.8 billion in debts
to the Bankruptcy Court on the first day of its chapter 11
cases.

Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134).  Refco, LLC,
is a regulated commodity futures company that has businesses in
the United States, London, Asia and Canada.  Refco, LLC, filed
for bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc.  Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.

On April 13, 2006, the Court appointed Marc S. Kirschner as
Refco Capital Markets Ltd.'s chapter 11 trustee.  Mr. Kirschner
is represented by Bingham McCutchen LLP.  RCM is Refco's
Operating subsidiary based in Bermuda.

Three more affiliates of Refco, Westminster-Refco Management
LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC,
filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-11260 through 06-11262).  (Refco Bankruptcy News,
Issue No. 34; Bankruptcy Creditors' Service, Inc., 215/945-
7000).




=============
B O L I V I A
=============


COUER D'ALENE: To Begin Construction of San Bartolome Project
-------------------------------------------------------------
Coeur D'Alene Mines Corp. will begin this month constructing its
San Bartolome silver project, which has an investment of US$135
million, Reuters reports.

According to Reuters, the initial phase of the construction will
be on a silver-processing plant in Potosi, in the southwest
region of Bolivia, which the mines ministry dubs as the "start
of the reactivation of the mining sector."

Coeur estimates that the project will begin producing the
projected 8 million ounces of silver per year by the end of
2007, as it was planned, Reuters says.

The Bolivian government told Reuters that the San Bartolome
silver mine will increase its assistance to the city's 120,000
residents as it will process the metals gathered by seven mining
companies in Potosi.

Coeur d'Alene Mines Corp. -- http://www.coeur.com/-- is
the world's largest primary silver producer, as well as a
significant, low-cost producer of gold.  The Company has mining
interests in Nevada, Idaho, Alaska, Argentina, Chile, Bolivia
and Australia.

                        *    *    *

Coeur d'Alene Mines Corporation's US$180 Million notes due
Jan. 15, 2024, carry Standard & Poors' B- rating.




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


ALERIS INT'L: Gets Requisite Consents on Tender Offer of Notes
--------------------------------------------------------------
Aleris International, Inc., received the requisite consents on
its previously announced tender offer to purchase for cash any
and all of its outstanding 10-3/8% Senior Secured Notes Due 2010
(CUSIP No. 449681AC9) and 9% Senior Notes Due 2014 (CUSIP No.
014477AA1), to eliminate all of the restrictive covenants and
events of defaults and certain related provisions contained in
the indentures governing the Notes.

As a result of obtaining the requisite consents, Aleris executed
and delivered supplemental indentures setting the amendments to
the indentures governing the Notes.  The supplemental indentures
provide that the amendments to the indentures will only become
operative when validly tendered Notes are accepted for purchase
pursuant to the tender offer.  The tender offer will expire at
midnight, New York City time, on July 28, 2006, unless
terminated or extended and remains subject to the prior
satisfaction or waiver of the conditions described in the offer
documents.

Approximately US$200,830,000 million principal amount, or
96.17%, of the outstanding principal amount of the 10 3/8% Notes
and US$124,910,000 million principal amount, or 99.93%, of the
outstanding principal amount of the 9% Notes, and the consents
related to these notes, have been validly tendered by 5:00 p.m.
New York City time, on July 14, 2006.  Withdrawal rights of
tendering holders of the Notes have expired.

The dealer manager for the tender offer and the solicitation
agent for the consent solicitation can be reached at:

             Deutsche Bank Securities Inc.
             Tel: (212) 250-6008 (collect)

The depositary and information agent can be contacted at:

             Mackenzie Partners, Inc.
             Tel: (212) 929-5500 (collect)
                  (800) 322-2885 (toll-free)


                  About Aleris International

Headquartered in Beachwood, Ohio, a suburb of Cleveland, Aleris
International, Inc. -- http://www.aleris.com/-- is a major
North American manufacturer of rolled aluminum products and is a
global leader in aluminum recycling and the production of
specification alloys.  The company is also a leading
manufacturer of value-added zinc products that include zinc
oxide, zinc dust and zinc metal.  The Company operates 42
production facilities in the United States, Brazil, Germany,
Mexico and Wales, and employs
approximately 4,200 employees.

                        *    *    *

Moody's Investors Service affirmed on July 10, 2006, Aleris
International, Inc.'s B1 corporate family rating.  In a related
rating action, Moody's assigned a Ba3 rating to the company's
proposed 7-year senior secured guaranteed term loans aggregating
US$650 million, which Aleris is issuing to partially finance its
EUR691 million acquisition of certain aluminum assets from Corus
Group plc and refinance its existing debt.

Moody's affirmed these ratings:

   -- US$210 million senior secured notes, 10.375% due
      2010: B2; and

   -- US$125 million senior unsecured notes, 9.0% due
      2014: B3.

Moody's assigned this rating:

   -- US$400 million senior secured guaranteed term loan
      due 2013: Ba3.


ALERIS INTERNATIONAL: S&P Affirms BB- Corporate Credit Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit rating on Beachwood, Ohio-based Aleris International Inc.
and removed it from CreditWatch, where it was placed with
negative implications on March 21, 2006.  The CreditWatch
placement followed Aleris' announcement that it would acquire
the downstream aluminum assets of Corus Group PLC (BB/Stable/B)
for US$880 million in cash and assumed debt.  The outlook is
negative.

At the same time, Standard & Poor's assigned its 'BB-' and '2'
recovery ratings to the company's proposed US$650 million senior
secured term loan B.  The '2' recovery rating indicates the
expectation of a substantial (80%-100%) recovery of principal in
the event of a payment default.  The ratings are based on
preliminary terms and conditions and are predicated on the
completion of the Corus transaction and related financings
substantially in the form currently anticipated.

"The company's debt levels are relatively high, and we remain
concerned that management will continue to opportunistically
make cash-financed acquisitions," said Standard & Poor's credit
analyst Marie Shmaruk.  "However, Aleris' markets remain
relatively healthy, which should enable the company to reduce
leverage to less than 4x.  We could change the outlook to stable
if management reaches and maintains more moderate debt levels.
Ratings on Aleris could be pressured if the company's debt
levels remain high and performance weakens materially because of
intensified competition or weaker market conditions."

The proceeds from the issue, along with proceeds from a
revolving credit facility and bridge loans, will primarily be
used to:

   -- refinance existing debt,
   -- finance the acquisition, and
   -- fund working capital and transactions costs.

Aleris is a vertically integrated manufacturer of aluminum sheet
for distributors and the transportation, construction, and
consumer durables end-user markets.


COMPANHIA SIDERURGICA: Gets Antitrust Clearance in Lusosider Buy
----------------------------------------------------------------
Companhia Siderurgica Nacional aka CSN was cleared from
antitrust issues by Portuguese authorities in its 100%
acquisition of Lusosider, a company official told Business News
Americas.

In May, CSN inked a EUR25 million sale and purchase agreement
with Corus to acquire all of the latter's stake in Lusosider,
which is a 50-50 joint venture of both companies, BNamericas
says.

"The acquisition reinforces the company's commitment to its
international expansion strategy, increasing its operations
abroad by acquiring finishing lines located near the largest
steel markets," CSN told BNamericas.

                        *    *    *

On Jan. 26, 2006, Standard and Poor's Rating Services assigned 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.


NALCO CO: Fitch Upgrades Sr. Notes' Rating to BB from B+
--------------------------------------------------------
Fitch has taken these rating actions on Nalco Company:

   Nalco

   -- Senior unsecured debt upgraded to 'BB/RR1' from 'B+/RR3';

   -- Senior secured credit facility and term loans affirmed at
      'BB/RR1';

   -- Senior subordinated notes affirmed at 'B-/RR5'; and

   -- Issuer Default Rating affirmed at 'B'.

   Nalco Finance Holdings Inc.

   --Senior discount notes affirmed at 'CCC+/RR6'.

Fitch has also assigned a 'B' IDR to Nalco Finance Holdings,
Inc.  The Rating Outlook remains Stable.

The upgrade of the senior unsecured notes is a result of
increased recovery and overall debt repayment in the last 18
months of approximately US$185 million since Dec. 31, 2004.  The
majority of this debt repayment was at the Term Loan A level.
Fitch's Recovery Ratings incorporate an evaluation using a
distressed EBITDA and a derived multiple reflecting scorecard
characteristics for the company and industry; the going concern
value remains higher than the asset liquidation value.  Recovery
prospects for Nalco's senior secured revolving credit facility,
senior secured term loan and senior unsecured notes continue to
be outstanding according to Fitch's 'RR1' Recovery Ratings
Scale.  The 'RR1' reflects the very high principal recovery
expected for the senior secured credit facilities and unsecured
notes.

The Stable Rating Outlook reflects the improvement in Nalco's
businesses and the strengthening of the economies around the
world. Margins have declined slightly in 2005 and continued
downward into 2006 due to higher raw material, energy and
transportation costs, but are expected to strengthen as price
increases continue to take effect and as the market fundamentals
strengthen.  Fitch remains moderately concerned about increasing
energy costs and the overall effect of high raw material prices
on demand.  However, with water becoming a scarce commodity in
some parts of the globe, it is expected that water treatment and
water treatment products will likely see a major increase in
demand in the coming years.

As of March 31, 2006, Nalco's balance sheet debt plus accounts
receivable (A/R) program balance totaled US$3.228 billion.
Nalco had a total debt-to-Operating EBITDA of 5.5x including the
senior discount notes for the latest 12 months ending March 31,
2006.  Operating EBITDA to gross interest incurred was 2.26x for
the same period.  Balance sheet debt consists of US$1.145
billion in senior secured term loans, $906.9 million in senior
unsecured notes, US$706.9 million in senior subordinated notes
and US$361.3 million in senior discount notes.  In addition,
Nalco's US$100 million A/R program had a balance of US$78.6
million at year-end.

Nalco has a modest maturity schedule, with approximately US$3.8
million due in 2006 and US$96 million due in 2007.  Nalco is
expected to have the financial flexibility to repay and/or
replace such debt maturities given Fitch's base case projections
for operating cash flow, access to the debt market, and adequate
availability under its credit facility.

The ratings are supported by Nalco's leading market position,
broad product offerings, geographical reach, and strong customer
retention. Concerns include a highly leveraged capital
structure, and the majority of assets are intangibles.  Growth
rates in the water treatment segment are modest and tend to
track gross domestic product, however growth rates vary by end-
use segment and region.  Fitch estimates growth in North America
in 2006 to be in the 3 to 4 percent range. Emerging markets such
as Latin America, Eastern Europe and Pacific region are likely
to grow at 3.5% to 6% per year.  Therefore, Nalco is likely to
realize more volume growth in emerging markets.  Fitch estimates
overall sales growth for Nalco in 2006 to be close to 4%.

Nalco is a leading global provider of integrated water treatment
and process improvement services, chemicals and equipment
programs for industrial and institutional applications.  Nalco's
products and services are typically used in water treatment
applications to prevent corrosion, contamination and the buildup
of harmful deposits, or in production processes to enhance
process efficiency and improve the customers' end products.
Nalco generated Operating EBITDA of US$597 million on $3.3
billion in sales in 2005.  North America accounts for 48% of
sales with the rest of the world making up the balance.  They
are organized into three divisions that correspond to the end
markets they serve:

   -- Industrial and Institutional Services,
   -- Energy Services and
   -- Paper Services.


VARIG SA: Creditors Voted Against Volo's US$500-Million Offer
-------------------------------------------------------------
Creditors of Brazil's flagship airline Viacao Aerea Rio-
Grandense SA Monday voted to reject a US$500-million bid for the
company's operating assets from Volo do Brasil, potentially
signaling the end for the ailing company.

Representatives of Varig workers and pensioners and principal
government creditors agreed to accept Volo's offer.  However,
other key creditors, led by airline leasing companies, refused,
an airline spokesman said.

Rio de Janeiro bankruptcy judges must now decide on whether to
continue to search for a restructuring solution for the indebted
airline or to liquidate its assets.  An auction would have been
conducted on July 19 if creditors voted to accept Volo's offer.

VARIG may entertain other suitors.  Cinzel Partners fund has
created a consortium of investors to come up with a
US$600,000,000 bid for VARIG, according to Investnews.

Roberto Lima Netto, former president of Brazilian steel maker
Companhia Siderurgica Nacional and representative of Cinzel, has
told O Estado de Sao Paulo that the consortium intends to
acquire as much as 30% of VARIG's operations.  Cinzel will allow
the airline's employees to acquire the 20% while the remainder
would be sold in a public offering.

Reuters reports that Marcelo Bottini, VARIG's chief executive
officer, disputes the results of the creditors' meeting and
would ask the Brazilian Court for a recount.  Mr. Bottini
pointed out that smaller creditors were given the same voting
power as larger creditors.  He noted that the larger creditors
voted for Volo's offer.

Volo, which recently purchased Varig's cargo unit, VARIG
Logistica S.A., is partially controlled by U.S. investment fund
MatlinPatterson Global Advisors.

Varig has been in financial trouble for a number of years amid
mounting debts, which now total around BRL8 billion (US$3.6
billion).

The airline is having trouble paying for landing and departure
fees and fuel for its jets.  Meanwhile, over two-thirds of its
planes are grounded as leasing companies demand their craft back
and the company can't pay for basic maintenance.

The company has only been able to continue flying at all because
of daily deposits by Volo, which already total over US$11
million, according to Reuters.

                         About VARIG

Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin
America.  VARIG's principal business is the transportation of
passengers and cargo by air on domestic routes within Brazil and
on international routes between Brazil and North and South
America, Europe and Asia.  VARIG carries approximately 13
million passengers annually and employs approximately 11,456
full-time employees, of which approximately 133 are employed in
the United States.

The Company, along with two affiliates, filed for a judicial
reorganization proceeding under the New Bankruptcy and
Restructuring Law of Brazil on June 17, 2005, due to a
competitive landscape, high fuel costs, cash flow deficit, and
high operating leverage.  The Debtors may be the first case
under the new law, which took effect on June 9, 2005.  Similar
to a chapter 11 debtor-in-possession under the U.S. Bankruptcy
Code, the Debtors remain in possession and control of their
estate pending the Judicial Reorganization.  Sergio Bermudes,
Esq., at Escritorio de Advocacia Sergio Bermudes, represents the
carrier in Brazil.

Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative.  In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case
Nos. 05-14400 and 05-14402).  Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States.  As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts.


VOLKSWAGEN AG: Cutting Up to 6,000 Jobs in Brazilian Plants
-----------------------------------------------------------
German automaker Volkswagen AG has scheduled 4,000 to 6,000 job
layoffs in its Brazilian plants through 2008.

Bloomberg News says that the firing of workers may begin as
early as this week as Volkswagen seeks to cut costs by
decreasing labor costs.

Volkswagen has five factories in Brazil with approximately
21,000 workers.

The Taubate plant in Sao Paulo will be the first to get hit with
layoffs once labor talks fail, Milton Junior, labor relations
manager for the company's Brazilian unit told Bloomberg.  The
plant, which makes Parati and Gol cars, employs 4,500 people.
A union representative told Bloomberg that Volkswagen plans to
fire 160 workers at Taubate.

Volkswagen is losing money in Brazil as the currency gained 61%
forcing the company to raise prices, which resulted to losses in
export profits.

According to the Xinhua news agency, Volkswagen is lobbying,
along with other exporters, for an exchange rate between 2.60 to
2.70 reals for US$1.  The U.S. dollar's value dropped to 2.10
reals recently.

The company's restructuring plan will result to a decrease in
production to 514,000 in 2008, while annual exports will be cut
to 100,000, Xinhua states.

Volkswagen will also cut jobs at its plants in Sao Bernardo do
Campo and Sao Jose dos Pinhais.

Headquartered in Wolfsburg, Germany, the Volkswagen Group
-- http://www.volkswagen.de/-- is one of the world's leading
automobile manufacturers and the largest carmaker in Europe.
With 47 production plants in eleven European countries and a
further seven countries in the Americas, Asia and Africa,
Volkswagen has more than 343,000 employees producing over 21,500
vehicles or are involved in vehicle-related services on every
working day.

                        *    *    *

Volkswagen has been carrying out measures to cut costs and raise
profits, which could affect up to 30,000 jobs.  The potential
job cuts represent about a third of the carmaker's workforce and
three times higher than initial estimates made by Chief
Executive Bernd Pischetsrieder and Volkswagen brand head,
Wolfgang Bernhard.

In November last year, Volkswagen maintained its 2005 earnings
guidance amid rumors it may lower targets.  The company predicts
a year-on-year improvement in both operating profit after
special items and profit before tax this year.  Rumors flew that
the company would slash full-year earnings forecast due to
higher restructuring costs.  The company said the impact of its
workforce reduction measures, which will be charged as special
items in the fourth quarter, will be lower than last year's.

The company also admitted there were no significant improvements
in the economic environment in the first nine months of 2005,
and the overall situation in the important automotive markets
remained difficult.  It also expected tougher competition in the
Chinese and U.S. markets, and the rise in fuel prices to
influence consumer confidence.


* BRAZIL: Loans US$100MM to Jamaica to Revive Sugar Industry
------------------------------------------------------------
Jamaica's Prime Minister Portia Miller and Brazil's Pres. Luiz
Lula da Silva agreed to close the negotiations on a US$100
million credit line that will be used to import machinery and
agricultural equipment to re-establish Jamaica's sugar industry,
the Jamaica Information Service reports.

Both countries have entered into a program to:

   -- produce ethanol and renewable energy, and
   -- introduce new, high-yield variety of sugar cane

in Jamaica.  Furthermore, Brazilian experts will be sent to
Jamaica to study food processing and tropical agriculture of the
country, as part of a technical assistance program, the Jamaica
Information relates.

According to Jamaica Information, the agreement was one of the
agenda in the leaders' talks in hastening the cooperation
project in the areas of:

   -- agriculture,
   -- health,
   -- energy and
   -- law enforcement.

                        *    *    *

On May 26, 2006, Moody's Investors Service upgraded Jamaica's
rating under a revised foreign currency ceiling:

   -- Long-term foreign currency rating: Ba3 from B1 with
      stable outlook.


                        *    *    *

Fitch upgraded these ratings of Brazil on June 29, 2006:

   -- Long-term foreign currency IDR: to 'BB' from 'BB-';
   -- Long-term local currency IDR: to 'BB' from 'BB-'; and
   -- Country ceiling to 'BB' from 'BB-'.

Fitch also affirmed Brazil's short-term rating at 'B'.




===========================
C A Y M A N   I S L A N D S
===========================


ALTEDGE ADVISORS: Proofs of Claim Filing Is Until July 25
---------------------------------------------------------
Altedge Advisors Limited's creditors are required to submit
proofs of claim by July 25, 2006, to the company's liquidator:

   Xavier Himmer
   7 Albernarle Street
   London W1X 3HF, United Kingdom

Creditors who are not able to comply with the July 25 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Altedge Advisors' shareholders agreed on June 27, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

   Susan Taylor
   c/o Ogier
   P.O. Box 1234, George Town
   Grand Cayman, Cayman Islands
   Tel: (345) 949 9876
   Fax: (345) 949 9877


EQUALT FEEDER: Last Day to File Proofs of Claim Is on July 31
-------------------------------------------------------------
Equalt Feeder Fund SPC's creditors are required to submit proofs
of claim by July 31, 2006, to the company's liquidator:

   S.L.C. Whicker
   K.D. Blake
   KPMG
   Grand Cayman, Cayman Islands

Creditors who are not able to comply with the July 31 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Equalt Feeder's shareholders agreed on June 19, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

   Caroline Cookson
   P.O. Box 493, George Town
   Grand Cayman, Cayman Islands
   Tel: 345-914-4331
        345-949-4800
   Fax: 345-949-7164


HIGHLAND GLOBAL MASTER: Proofs of Claim Filing Is Until Aug. 10
---------------------------------------------------------------
Highland Global Master SPC's creditors are required to submit
proofs of claim by Aug. 10, 2006, to the company's liquidator:

   Q&H Nominees, Ltd.
   Third Floor, Harbour Centre
   P.O. Box 1348, George Town
   Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 10 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Highland Global's shareholders agreed on June 16, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

   Quin & Hampson (Ref: MJT)
   P.O. Box 1348, George Town
   Grand Cayman, Cayman Islands
   Tel: +1 345 949 4123
   Fax: +1 345 949 4647


HIGHLAND GLOBAL SPC: Claims Filing Deadline Is Set for Aug. 10
--------------------------------------------------------------
Highland Global SPC's creditors are required to submit proofs of
claim by Aug. 10, 2006, to the company's liquidator:

   Q&H Nominees, Ltd.
   Third Floor, Harbour Centre
   P.O. Box 1348, George Town
   Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 10 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Highland Global's shareholders agreed on June 16, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

   Quin & Hampson (Ref: MJT)
   P.O. Box 1348, George Town
   Grand Cayman, Cayman Islands
   Tel: +1 345 949 4123
   Fax: +1 345 949 4647


INTEGRO HOLDINGS: Deadline for Claims Filing Is Set for Aug. 4
--------------------------------------------------------------
Integro Holdings Ltd.'s creditors are required to submit proofs
of claim by Aug. 4, 2006, to the company's liquidator:

   William P. Costantini
   New York, NewYork, USA

Creditors who are not able to comply with the Aug. 4 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Integro Holdings' shareholders agreed on May 12, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

   William P. Costantini
   c/o P.O. Box 2681, George Town
   Grand Cayman, Cayman Islands
   Tel: (212) 295-5750
   Fax: (212) 295-5751


MERRILL LYNCH: Creditors Must File Proofs of Claim by Aug. 10
-------------------------------------------------------------
Merrill Lynch QA Merger Arbitrage Master Fund Limited's
creditors are required to submit proofs of claim by
Aug. 10, 2006, to the company's liquidators:

   John Cullinane
   Derrie Boggess
   c/o Walkers SPV Limited
   P.O. Box 908, George Town
   Grand Cayman, Cayman Islands
   Tel: (345) 914-6305

Creditors who are not able to comply with the Aug. 10 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Merrill Lynch's shareholders agreed on June 16, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


NOTTINGHAM LIMITED: Creditors Have Until Aug. 10 to File Claims
---------------------------------------------------------------
Nottingham Limited's creditors are required to submit proofs of
claim by Aug. 10, 2006, to the company's liquidators:

   Ian Wight
   Stuart Sybersma
   Deloitte
   P.O. Box 1787, George Town
   Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 10 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Nottingham Limited' shareholders agreed on June 7, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

   Nicole Ebanks
   Deloitte
   P.O. Box 1787, George Town
   Grand Cayman, Cayman Islands
   Tel: (345) 949-7500
   Fax: (345) 949-8258


PEYPER INVESTMENTS: Proofs of Claim Must be Filed by Aug. 10
------------------------------------------------------------
Peyper Investments' creditors are required to submit proofs of
claim by Aug. 10, 2006, to the company's liquidators:

   C.I. Directors Ltd.
   P.O. Box 1110, George Town
   Grand Cayman, Cayman Islands
   Tel: (345) 949-7212
   Fax: (345) 949-0993

Creditors who are not able to comply with the Aug. 10 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Peyper Investments' shareholders agreed on June 14, 2006, for
the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


ULYSSES FUND: Claims Filing Deadline Is Set for July 31
-------------------------------------------------------
Ulysses Fund's creditors are required to submit proofs of claim
by July 31, 2006, to the company's liquidator:

   David A.K. Walker
   Lawrence Edwards
   PricewaterhouseCoopers
   Strathvale House, George Town
   Grand Cayman, Cayman Islands

Creditors who are not able to comply with the July 31 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Ulysses Fund's shareholders agreed on March 31, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

   Miguel M. Brown
   P.O. Box 219, George Town
   Grand Cayman, Cayman Islands
   Tel: (345) 914-8665
   Fax: (345) 949-4590


VICTORIA HOLDINGS: Proofs of Claim Filing Is Until Aug. 10
----------------------------------------------------------
Victoria Holdings Ltd.'s creditors are required to submit proofs
of claim by Aug. 10, 2006, to the company's liquidator:

   Victoria Hollingworth-Havlin
   VLH Accounting Services
   7 Selkirk Plaza, 80 West Bay Road
   P.O. Box 1215, George Town
   Grand Cayman, Cayman Islands
   Tel: (345) 946-7175
   Fax: (345) 946-7174

Creditors who are not able to comply with the Aug. 10 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Victoria Holdings' shareholders agreed on June 15, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.




=========
C H I L E
=========


SHAW GROUP: Incurs US$16.7 Mil. Net Loss in Third Quarter 2006
--------------------------------------------------------------
The Shaw Group Inc. filed its financial results for the third
quarter ended March 31, 2006, to the Securities and Exchange
Commission on July 10, 2006.

For the three months ended March 31, 2006, the Company incurred
a US$16.7 million net loss on US$1.2 billion of net revenues,
compared to a US$21.7 million net loss on US$891 million of net
revenues in 2005.

As of May 31, 2006, the Company had cash and cash equivalents of
US$137.3 million, which included US$19.7 million of restricted
and escrowed cash, and US$155.5 million of availability under
our US$750.0 million Credit Facility to fund operations.

A full-text copy of the Company's Quarterly Report is available
for free at http://researcharchives.com/t/s?db4

The Shaw Group Inc. -- http://www.shawgrp.com/-- is a leading
global provider of technology, engineering, procurement,
construction, maintenance, fabrication, manufacturing,
consulting, remediation, and facilities management services for
government and private sector clients in the energy, chemical,
environmental, infrastructure and emergency response markets.
Headquartered in Baton Rouge, Louisiana, with over US$3 billion
in annual revenues, Shaw employs approximately 20,000 people at
its offices and operations in Venezuela, Chile, North America,
Europe, the Middle East and the Asia-Pacific region.

The company's credit rating carries Standard & Poor's BB rating.
That rating was assigned July 27, 2005.




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


BANCOLOMBIA: Inks Letter of Intent With Portal to Sell Almacenar
----------------------------------------------------------------
Bancolombia S.A. signed a binding letter of agreement on
July 14, 2006, with Portal de Inversiones S.A., for the sale of
its current share holding in Almacenar S.A. for
COP28,974,430,000.

Bancolombia holds a 94.33% direct interest in Almacenar and a
3.92% indirect interest through Colcorp S.A., and the same
percentage of shares that would be held in the corporation
resulting from the spin-off of Almacenar.

Portal de Inversiones S.A. is an entity incorporated by the
parties with which Bancolombia entered into a preliminary
agreement on November 23, 2005.  The consummation of the
transaction is subject to the fulfillment of the closing
conditions stipulated in the binding letter of intent,
including, among others, the receipt of required authorizations.

                        *    *    *

The Troubled Company Reporter-Latin America reported on
April 28, 2006, that Moody's Investors Service upgraded
Bancolombia's bank financial strength ratings to D+ from D with
a stable outlook.

Moody's added that the action concludes the review for possible
upgrade that was announced on October 13, 2005.  Moreover,
Bancolombia's Ba3/Not Prime long- and short-term foreign
currency deposit ratings were affirmed.  Moody's said the
outlook on all ratings is stable.

                        *    *    *

On Dec. 22, 2005, Fitch affirmed the ratings assigned on
Bancolombia, as:

  -- Long-term/short-term foreign currency at 'BB/B';
  -- Long-term/short-term local currency at 'BBB-/F3';
  -- Individual at 'C';
  -- Support at '3'.


HEXION SPECIALTY: Swapping US$150M of Notes for Registered Bonds
----------------------------------------------------------------
Hexion Specialty Chemicals Inc. is offering to exchange up to
US$150,000,000 aggregate principal amount of its registered
Second-Priority Senior Secured Floating Rate Notes Due 2010,
issued on May 20, 2005, for new notes with the same terms but
are freely tradable.  The Company has not yet set a date for the
expiration of the offer.

The terms of the exchange notes are identical to the terms of
the old notes in all material respects, except for the
elimination of some transfer restrictions, registration rights
and additional interest provisions relating to the old notes.

Hexion agreed to file a registration statement relating to
an offer to exchange the old notes for exchange notes under a
registration rights agreement with the initial purchasers of the
old notes.  The Company was also required to consummate the
exchange offer on or before March 16, 2006.  Because the
exchange offer was not consummated on March 16, the Company
incurred additional interest expense in the aggregate amount of
approximately US$350,000.

Hexion will not receive any cash proceeds from the issuance of
the exchange notes.  Net proceeds of the offering of the old
notes amounted to US$141 million.  The proceeds from the old
notes were used to repay amounts outstanding under the Company's
bridge loan facility.

A full-text copy of the Registration Statement is available for
free at http://researcharchives.com/t/s?da3

                   About Hexion Specialty

Based in Columbus, Ohio, Hexion Specialty Chemicals Inc.
-- http://hexion.com/-- makes thermosetting resins (or
thermosets).  Thermosets add a desired quality (heat resistance,
gloss, adhesion) to a number of different paints and adhesives.
Hexion also makes formaldehyde and other forest product resins,
epoxy resins, and raw materials for coatings and inks.  The
Company has 86 manufacturing and distribution facilities in 18
countries.  In South America, the company's distribution
facilities, as well as executive sales and administrative
offices, are located in Argentina, Brazil and Colombia.

                        *    *    *

As reported in the Troubled Company Reporter on May 4, 2006,
Standard & Poor's Ratings Services assigned its 'B+' rating and
its recovery rating of '3' to Hexion Specialty's US$1.675
billion senior secured term loan and synthetic letter of credit
facilities.

The rating on the existing US$225 million revolving credit
facility was lowered to 'B+' with a recovery rating of '3', from
'BB-' with a recovery rating of '1', to reflect the similar
security package as the new term loan and synthetic letter of
credit facility.

The ratings on the existing senior second secured notes were
raised to 'B', with a recovery rating of '3', from 'B-' with a
recovery rating of '5'.  The ratings on the senior second
secured notes reflect the amount of priority claims of the
revolving facility and the first-lien term loan lenders.

At the same time, Standard & Poor's affirmed its 'B+' corporate
credit rating on Hexion and revised the outlook to stable from
negative.


* COLOMBIA: NatGas Pipeline to Include Fiber Optic Cable
--------------------------------------------------------
The construction of a US$335-million natural gas pipeline that
will connect Venezuela, Colombia and Panama will include a fiber
optic cable to help improve communications among the three
nations, according to a report from El Universal.

Last week, the presidents of Venezuela, Colombia and Panama
formally inaugurated the construction of the pipeline.

Venezuela's state-run oil firm, Petroleos de Venezuela will fund
the construction of the pipeline.  The 225 km, 150 million cubic
feet gas pipeline is expected to become operational in 2007.

According to Petroleos de Venezuela, 10% of its total investment
will be used to fund social projects in areas where the pipeline
will be laid.

                        *    *    *

On May 30, 2005, Fitch Ratings affirmed Colombia's ratings as:

      -- Long-term foreign currency 'BB';
      -- Country ceiling 'BB';
      -- Local currency 'BBB-';
      -- Short-term 'B'.

Fitch said the Rating Outlook is Stable.




===================================
D O M I N I C A N   R E P U B L I C
===================================


FALCONBRIDGE: Inco & Phelps Dodge Increase Merger Offer
-------------------------------------------------------
Phelps Dodge Corp., Inco Ltd. and Falconbridge Ltd. (TSX:
FAL)(NYSE: disclosed that all three companies have taken action
to improve the terms of their three-way combination.  Phelps
Dodge has increased the cash portion of the consideration to be
paid to the shareholders of Inco in the combination of Phelps
Dodge and Inco by CDN$2.75 per Inco share.  Inco has increased
the cash portion of its offer to purchase all outstanding common
shares of Falconbridge by CDN$1.00 per Falconbridge share, and
the Falconbridge board of directors has declared a special cash
dividend of CDN$0.75 per Falconbridge common share.

                       Improved Terms

Under the improved terms, Phelps Dodge will acquire all
outstanding common shares of Inco for a combination of cash and
common shares of Phelps Dodge having a value of CDN$80.70 per
Inco share, based upon the closing price of Phelps Dodge stock
and the closing U.S./Canadian dollar exchange rate on July 14,
2006.  Shareholders of Inco will receive 0.672 shares of Phelps
Dodge stock plus CDN$20.25 per share in cash for each share of
Inco stock.  This represents a premium of 7.8 percent to Inco's
market price as of close of trading on July 14 and a premium of
23.7 percent to Inco's market price as of the close of trading
on June 23, the last trading day before the announcement of the
combination of Phelps Dodge, Inco and Falconbridge.

Under its enhanced bid for Falconbridge, Inco is now offering
CDN$18.50 plus 0.55676 shares of Inco for each share of
Falconbridge, assuming full proration of the consideration.
With the completion of both transactions, Falconbridge
shareholders would receive an implied total consideration on a
"look-through" basis of CDN$63.43 per Falconbridge common share,
consisting of:

(a) CDN$29.77 in cash; and

(b) 0.3741 of a Phelps Dodge Inco Corp. common share (based
    on the closing price of the Phelps Dodge common shares
    on the New York Stock Exchange and applicable U.S.
    Federal Reserve U.S.-Canadian dollar exchange rates on
    July 14, 2006).

               Falconbridge Special Dividend

In order to further increase the value received by Falconbridge
shareholders, the board of Falconbridge declared a special cash
dividend of CDN$0.75 per Falconbridge share payable on
Aug. 10, 2006, to common shareholders of record at the close of
business on July 26, 2006.  The Falconbridge board also has
unanimously determined that Inco's amended offer for the shares
of the company is superior to the unsolicited offer by Xstrata
and unanimously recommends that Falconbridge shareholders accept
the Inco offer.

           Reduction in Minimum Tender Condition

In addition, Inco has reduced the minimum condition in its offer
for Falconbridge from two thirds of the outstanding shares of
Falconbridge to 50.01 percent of such outstanding shares on a
fully diluted basis. Phelps Dodge and Inco also amended their
Combination Agreement so that the combination of Phelps Dodge
and Inco may be consummated before the acquisition by Inco of
100% of Falconbridge.  Inco's amended offer for Falconbridge
will expire on July 27, 2006.

The three-way combination of Phelps Dodge, Inco and Falconbridge
will create one of the world's leading mining companies and the
largest based in North America.  Phelps Dodge Inco will be the
world's leading nickel producer, the largest publicly traded
copper producer and a leading producer of molybdenum and cobalt.

As part of the transaction, Phelps Dodge expects to repurchase
up to US$5.0 billion of its shares in the 12 months after
closing.

J. Steven Whisler, chairman and chief executive officer of
Phelps Dodge, said: "We strongly believe the combination of
Phelps Dodge, Inco and Falconbridge represents a unique value-
creation opportunity for the shareholders of all three
companies.  There's no question that the value of the enhanced
Inco offer for Falconbridge is superior to the unsolicited offer
by Xstrata.  In addition to the value inherent in the offer, the
Falconbridge shareholders will have the ability to participate
in the upside resulting from the three-way combination through
their ownership of almost 30 percent of the combined company,
which includes a 30 percent share in the US$900 million of
expected annual synergies, which in total have a net present
value of approximately US$5.8 billion."

Scott Hand, chairman and chief executive officer of Inco, said:
"Today's actions demonstrate our shared commitment to create the
leading North American-based mining company and a global
powerhouse in copper and nickel.  That's great news for our
shareholders, for our employees, for our communities and for
Canada."

Derek Pannell, chief executive officer of Falconbridge, said:
"We are pleased with the actions taken by Phelps Dodge and Inco
and by their affirmation of the value of Falconbridge.  The
special dividend declared by our board today further enhances
the expected return to our shareholders. We are confident our
shareholders will see the value in the combination of these
three companies to create Phelps Dodge Inco."

All required regulatory approvals for Inco's acquisition of
Falconbridge have been received.  Phelps Dodge's offer to
acquire Inco is expected to close in September, subject to
Phelps Dodge and Inco shareholder approval, regulatory approvals
and customary closing conditions.

                     About Phelps Dodge

Phelps Dodge Corp. -- http://www.phelpsdodge.com/-- produces
copper and molybdenum and is the largest producer of molybdenum-
based chemicals and continuous-cast copper rod.  The company and
its two divisions, Phelps Dodge Mining Co. and Phelps Dodge
Industries, employ approximately 15,000 people worldwide.

                         About Inco

Headquartered in Sudbury, Ontario, Inco Limited (TSX, NYSE:N)
-- http://www.inco.com/-- is the world's #2 producer of nickel,
which is used primarily for manufacturing stainless steel and
batteries.  Inco also mines and processes copper, gold, cobalt,
and platinum group metals.  It makes nickel battery materials
and nickel foams, flakes, and powders for use in catalysts,
electronics, and paints.  Sulphuric acid and liquid sulphur
dioxide are produced as byproducts.  The company's primary
mining and processing operations are in Canada, Indonesia, and
the UK.

                     About Falconbridge

Headquartered in Toronto, Ontario, Falconbridge Limited
(TSX:FAL) (NYSE:FAL) -- http://www.falconbridge.com/-- is a
leading copper and nickel company with investments in fully
integrated zinc and aluminum assets.  Its primary focus is the
identification and development of world-class copper and nickel
orebodies.  It employs 14,500 people at its operations and
offices in 18 countries.  The Company owns nickel mines in
Canada and the Dominican Republic and operates a refinery and
sulfuric acid plant in Norway.  It is also a major producer of
copper (38% of sales) through its Kidd mine in Canada and its
stake in Chile's Collahuasi mine and Lomas Bayas mine.  Its
other products include cobalt, platinum group metals, and zinc.

                        *    *    *

Falconbridge's CDNUS$150 million 5% convertible and callable
bonds due April 30, 2007, carries Standard & Poor's BB+ rating.




=============
E C U A D O R
=============


* ECUADOR: Plans to Auction Oil from Former Occidental Fields
-------------------------------------------------------------
Ecuador plans to put in the auction block the crude oil from
fields formerly drilled by US firm Occidental Petroleum after
failing to reach a deal to refine the oil in Venezuela, El
Universal reports, citing Ecuadorian energy minister Ivan
Rodriguez.

Minister Rodriguez explained that the agreement is put on hold
as the Venezuelan holding proposal is not convenient for
Ecuador, AFP reported.

"So far, we do not have a clear idea on the benefits for our
country. At first, Venezuela talked about (savings for) US$179
million, but we do not have any written instrument confirming
such a figure," the minister told a local TV network.

According to Reuters, Petroleos de Venezuela is required to
clarify the economic advantages for Ecuador of the proposed
agreement to trade crude oil for by-products otherwise the pact
will be cancelled.

"We are waiting until Wednesday for the Venezuelan proposal.
Then, we are going to consider the possibility to hold an
international bidding on the whole production from Block 15 up
to February, so that all state oil holdings can participate,
including Pdvsa, and those from Indonesia, South Korea, China,
Brazil and Colombia, which are interested in our oil," the
minister was quoted by El Universal as saying.

Once the agreement is discarded, the Ecuadorian government will
launch an international bidding on the 100,000 bpd Occidental
drilled before its operation agreement was terminated amid
allegations that it violated Ecuadorian laws, El Universal says.

                        *    *    *

Fitch assigned these ratings on Ecuador:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     B-      Aug. 29, 2005
   Long Term IDR       B-      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005




=====================
E L   S A L V A D O R
=====================


* EL SALVADOR: S&P Assigns BB+ Senior Unsecured Debt Rating
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB+' senior
unsecured debt rating to the Republic of El Salvador's
(BB+/Stable/B sovereign credit ratings) reopened 7.65% global
bond due in 2035.  With the recent US$225 million issue, the
total amount outstanding on this bond is now US$1 billion.

According to Standard & Poor's credit analyst Roberto Sifon-
Arevalo, the government of El Salvador is completing its
financial program for 2006 with this opening.  "El Salvador's
ratings are supported by a long history of prudent macroeconomic
management, stable institutions, and structural reform," said
Mr. Sifon-Arevalo.  "El Salvador has no monetary flexibility,
and it is therefore imperative that fiscal performance be
prudent," he added.

Mr. Sifon-Arevalo explained that the authorities in El Salvador
should be able to use the Dominican Republic and Central America
Free Trade Agreement (DR-CAFTA) as an engine of economic growth
over the medium term.  "If economic growth and fiscal
performance improve, the ratings could be raised," Mr. Sifon-
Arevalo noted. "However, if the deficit deteriorates more than
expected and growth underperforms, the ratings could come under
downward pressure," he concluded.




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


KAISER ALUMINUM: Court Allows MAXXAM to Sell Up to 3.5MM Shares
---------------------------------------------------------------
MAXXAM Inc. recently contacted Kaiser Aluminum Corporation and
its debtor-affiliates about selling up to 3,500,000 shares of
Kaiser Aluminum Corp. stock.

The Debtors have determined that the proposed disposition would
not adversely impact Kaiser Aluminum's tax attributes.

Accordingly, the Debtors and MAXXAM have reached an agreement to
modify their July 23, 2002 stipulation and agreed order to
permit MAXXAM's proposed disposition.

At the parties' behest, the U.S. Bankruptcy Court for the
District of Delaware authorizes MAXXAM to sell up to 3,500,000
shares of its KAC stock.

Judge Fitzgerald clarifies that other than the proposed sale,
MAXXAM will continue to be prohibited from disposing of any of
its remaining KAC stock prior to a hearing pursuant to its
agreement with KAC.

                       About MAXXAM Inc

Headquartered in Houston, Texas, MAXXAM Inc. (AMEX: MXM)
operates businesses ranging from aluminum and timber products to
real estate and horse racing.  MAXXAM's top revenue source is
Kaiser Aluminum, which has been in Chapter 11 bankruptcy since
2002.  MAXXAM's timber subsidiary, Pacific Lumber, owns about
205,000 acres of old-growth redwood and Douglas fir timberlands
in Humboldt County, California.  MAXXAM's real estate interests
include commercial and residential properties in Arizona,
California, Texas, and Puerto Rico.  The Company also owns the
Sam Houston Race Park, a horseracing track near Houston.
Chairman and CEO Charles Hurwitz controls 77% of MAXXAM.

                   About Kaiser Aluminum

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company, along with its Jamaican subsidiaries
-- Alpart Jamaica Inc. and Kaiser Jamaica Corporation -- filed
for chapter 11 protection on Feb. 12, 2002 (Bankr. Del. Case No.
02-10429), and has sold off a number of its commodity businesses
during course of its cases.  Corinne Ball, Esq., at Jones Day,
represents the Debtors in their restructuring efforts. Lazard
Freres & Co. serves as the Debtors' financial advisor.  Lisa G.
Beckerman, Esq., H. Rey Stroube, III, Esq., and Henry J. Kaim,
Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, and William P.
Bowden, Esq., at Ashby & Geddes represent the Debtors' Official
Committee of Unsecured Creditors.  The Debtors' Chapter 11 Plan
became effective on July 6, 2006.  On June 30, 2004, the Debtors
listed US$1.619 billion in assets and US$3.396 billion in debts.
(Kaiser Bankruptcy News, Issue No. 100; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


KAISER ALUMINUM: Wants Orricks Herrington's Payment Denied
----------------------------------------------------------
Kaiser Aluminum Corp. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to deny the
payment request of Orrick, Herrington & Sutcliffe LLP for fees
and expenses related to the Net Operating Losses Motion and
Protocol.

Orrick Herrington on behalf of the Official Committee of Retired
Salaried Employees and Voluntary Employees' Beneficiary
Association Trust for Salaried Retirees, reached an agreement
with the Debtors regarding the latter's NOL Motion.

The agreed resolution was in the form of a Protocol for Pre-
Effective Date Sales, which permits the Salaried VEBA Trust to
sell a portion of its interest under the Debtors' Reorganization
Plan, Kimberly D. Newmarch, Esq., at Richards, Layton & Finger,
in Wilmington, Delaware relates.

For work purportedly done on behalf of the Retiree's Committee,
Orrick requested interim payment of US$27,548 in fees and
US$1,052 in expenses for March 2006 and US$38,661 in fees and
US$500 in expenses for the next month.

In the March Statement, US$24,318 of the fees and at least
US$1,044 of the expenses relate to work done in connection with
the NOL Motion and the Protocol.  About US$36,087 in fees and at
least US$334 in expenses related to the same work were included
in the April 2006 Statement.

The Debtors, however, contend that Orrick's NOL Motion and
Protocol-related fees and expenses should be borne by the
Salaried VEBA Trust.

Ms. Newmarch explains that the issues raised in the NOL Motion
and resolved by the Protocol affect only the Salaried VEBA Trust
and not the Retiree's Committee.  She asserts that Orrick's
allocation of the fees at issue appears to be a misguided
attempt to sidestep the cap on the Salaried VEBA Trust's
administrative costs.

The Debtors insist that they will only reimburse administrative
costs only to the extent provided in the Amended Retiree Medical
Agreement.

                  Retirees Committee Objects

Frederick D. Holden, Jr., Esq., at Orrick, Herrington &
Sutcliffe LLP, in San Francisco, California, asserts that the
fees and expenses contested by the Debtors were reasonably
incurred by the Official Committee of Retired Salaried Employees
to preserve the rights of the salaried retirees.

Mr. Holden notes that the Retirees Committee has been directed
to serve as the authorized representative of the salaried
retirees in the Debtors' Chapter 11 cases, until the Plan
becomes effective.

All reasonable legal fees incurred by the Retirees Committee in
performing its duties through the effective date of the Plan
should be paid by the bankruptcy estate, Mr. Holden asserts.

The NOL Motion sought the Court's restriction of rights granted
under the Reorganizing Debtors' settlement agreement with the
Retirees Committee.  The Retirees Committee was therefore a
proper objecting party, Mr. Holden asserts.  He adds that
Section 1114 of the Bankruptcy Code make it the duty of the
Retirees Committee to oppose motions that would adversely impact
retiree benefits.

Accordingly, Orrick's NOL Motion-related fees and expenses
should not be borne by the Salaried VEBA Trust, Mr. Holden
asserts.

Mr. Holden assures the Court that all of Orrick's fees incurred
in connection with the modification of the Protocol have been
billed exclusively to the Salaried Retirees VEBA, since the
group requested the revisions.

The Reorganizing Debtors caused the subject expense, which
should not be borne by the salaried retirees, Mr. Holden
maintains.

Mr. Holden notes that, in settlement negotiations with the
Retirees Committee in early 2004, the Debtors never requested
any restriction on sales of rights before the effective date of
the Plan.  When the Debtors became aware of their desire for a
restriction, they directed the NOL Motion to the rights of the
salaried retirees, without raising the issue with the Retiree
Committee.

No one knows what might have been accomplished if negotiations
had preceded the filing of the NOL Motion, but the salaried
retirees should not have to pay for that tactical decision by
the Debtors, Mr. Holden says.

The Retirees Committee asks the Court to overrule the Debtors'
objection.

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company, along with its Jamaican subsidiaries
-- Alpart Jamaica Inc. and Kaiser Jamaica Corporation -- filed
for chapter 11 protection on Feb. 12, 2002 (Bankr. Del. Case No.
02-10429), and has sold off a number of its commodity businesses
during course of its cases.  Corinne Ball, Esq., at Jones Day,
represents the Debtors in their restructuring efforts. Lazard
Freres & Co. serves as the Debtors' financial advisor.  Lisa G.
Beckerman, Esq., H. Rey Stroube, III, Esq., and Henry J. Kaim,
Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, and William P.
Bowden, Esq., at Ashby & Geddes represent the Debtors' Official
Committee of Unsecured Creditors.  The Debtors' Chapter 11 Plan
became effective on July 6, 2006.  On June 30, 2004, the Debtors
listed US$1.619 billion in assets and US$3.396 billion in debts.
(Kaiser Bankruptcy News, Issue No. 100; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


* JAMAICA: In Talks With Brazil to Re-Establish Sugar Industry
--------------------------------------------------------------
Jamaica's Prime Minister Portia Miller and Brazil's Pres. Luiz
Lula da Silva agreed to close the negotiations on a US$100
million credit line that will be used to import machinery and
agricultural equipment to re-establish Jamaica's sugar industry,
the Jamaica Information Service reports.

Both countries have entered into a program to:

   -- produce ethanol and renewable energy, and
   -- introduce new, high-yield variety of sugar cane

in Jamaica.  Brazilian experts will be sent to Jamaica to study
food processing and tropical agriculture of the country, as part
of a technical assistance program, the Jamaica Information
relates.

According to Jamaica Information, the agreement was one of the
agenda in the leaders' talks in hastening the cooperation
project in the areas of:

   -- agriculture,
   -- health,
   -- energy and
   -- law enforcement.

                        *    *    *

Fitch upgraded these ratings of Brazil on June 29, 2006:

   -- Long-term foreign currency IDR: to 'BB' from 'BB-';
   -- Long-term local currency IDR: to 'BB' from 'BB-'; and
   -- Country ceiling to 'BB' from 'BB-'.

Fitch also affirmed Brazil's short-term rating at 'B'.

                        *    *    *

On May 26, 2006, Moody's Investors Service upgraded Jamaica's
rating under a revised foreign currency ceiling:

   -- Long-term foreign currency rating: Ba3 from B1 with
      stable outlook.




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


FORD MOTOR: Moody's Lowers Corp. Family & Sr. Unsecured Ratings
---------------------------------------------------------------
Moody's Investors Service lowered the Corporate Family and
senior unsecured ratings of Ford Motor Company to B2 from Ba3
and the senior unsecured rating of Ford Motor Credit Company to
Ba3 from Ba2.  The Speculative Grade Liquidity rating of Ford
has been affirmed at SGL-1, indicating very good liquidity over
the coming 12-month period.  The outlook for the ratings is
negative.

The downgrade of the Ford ratings reflects Moody's expectation
that the company's performance in North America will face
considerable additional stress due to high fuel prices and the
resulting shift in consumer preference away from the very
profitable SUV segment. During the six months through June 2006
Ford's sales of mid-size SUVs fell by 24.7% and sales of large
SUVs declined by 32.1%.  Despite the fact that solid market
acceptance of Ford's new mid-size and full-size cars has helped
maintain US market share above 18%, the dramatic shift away from
the SUV segment undermines prospects that Ford's Way Forward
restructuring program will materially strengthen its weak credit
metrics before 2008.  Bruce Clark, a senior vice president with
Moody's, said, "The strong performance of Ford's new cars is
certainly a positive.  But the profitability of these vehicles
doesn't come close to what the company had been earning on
Explorers and Expeditions.  This market shift is really hurting
Ford and is pushing out the time frame during which the
restructuring plan might contribute to any meaningful
improvement in its credit ratios."

In addition to the market shift from SUVs, Ford faces
considerable challenges in other areas. These include
implementing its extensive Way Forward restructuring initiative,
reversing the chronically poor performance of Jaguar, contending
with the ongoing erosion of its domestic supplier base,
addressing the growing competitiveness and share gains of Asian
manufacturers, and preparing for the renegotiation of its UAW
contract in late 2007.  As part of these contract negotiations
it will be critical for Ford to achieve a material degree of
relief in the areas of health care costs for active workers and
the JOBs bank program.  The decision by Ford's board of
directors to cut both the company's dividend and director fees
by half (with the annual dividend declining from about US$700
million to US$350 million) will have minimal impact on Ford's
cash flow, but may contribute the constructive character of the
dialogue with the UAW.

Ford's negative outlook reflects the fact that the company is
weakly positioned within the B2 rating category, and any
shortfall in contending with the array of challenges that it
faces could result in further pressure on the rating.  Ford's
liquidity position remains strong with US$24 billion in cash and
short-term VEBA balances, and the company's Speculative Grade
Liquidity Rating has been affirmed at SGL-1.  Nevertheless, the
company's weak operating and competitive position limits its
capacity to absorb additional stress.  For the LTM through March
2006, Ford's automotive business had an operating margin of
negative 2.8%, interest coverage well below 1x, and free cash
flow of negative US$2.8 billion.

The downgrade of Ford Credit's long-term rating to Ba3, with a
negative outlook, considers the firm's ownership by, and
concentrated operating relationship with, Ford Motor.  This
connection results in a ratings linkage between the two firms.
Ford Credit's rating already incorporated expectations that
declining portfolio balances, higher borrowing costs, and a
leveling of credit quality improvements are likely to constrain
the company's profitability in coming periods. However, in
Moody's view, Ford's deeper operating challenges and longer
turnaround horizon could have further negative implications for
Ford Credit's results and financial condition, including its
origination volumes, asset quality, profits and liquidity, thus
negatively affecting its stand-alone credit profile.

The one notch downgrade of Ford Credit's long-term rating widens
the differential from Ford's rating to two notches from one.
This notching differential continues to reflect Moody's view
that loss severity in the event of default for Ford Credit would
be meaningfully lower than for Ford.  At the lower extremity of
Moody's rating scale, the same difference in expected loss
results in a greater differential between the two firms'
ratings. While Moody's also believes Ford Credit's probability
of default is lower than its parent's, there remains uncertainty
by virtue of Ford's ownership and control that limits the
potential ratings differential between the two firms.  "We
believe Ford is economically motivated to maintain Ford Credit's
operating strengths and enterprise value, but it could direct
the company to take actions that, while seen by Ford's board to
be beneficial for the consolidated Ford enterprise, are
nevertheless adverse to Ford Credit's profile," said Mark
Wasden, a Moody's Senior Credit Officer.

Ford Motor Company, headquartered in Dearborn, Michigan, is the
world's third largest automobile manufacturer.  Ford Motor
Credit Company, also headquartered in Dearborn, Michigan, is the
world's largest auto finance company.


GENERAL MOTORS: Held Exploratory Talks With Nissan & Renault
------------------------------------------------------------
General Motors Corp., Renault and Nissan disclosed that an
exploratory discussion was held between Carlos Ghosn, President
and Chief Executive Officer of Renault, SAS and Nissan Motor
Co., Ltd., and Rick Wagoner, Chairman and Chief Executive
Officer of General Motors, Corp., regarding the possibility of
creating an industrial alliance among these three companies.
The companies agreed to cooperate in an expeditious,
confidential review of the potential benefits of such an
alliance to each company and the feasibility of achieving them.

"We had a good discussion today, and are looking forward to
having our teams work together to explore our ideas," Mr.
Wagoner and Mr. Ghosn said.  "It is important to let our teams
work on this review without distraction and, therefore, we will
not be providing further public comments about it at this time."

It is expected that this review will take approximately 90 days.
Following the review, the companies will consider whether
further exploration of the alliance concept is warranted.

General Motors Corp. -- http://www.gm.com/-- the world's
largest automaker, has been the global industry sales leader for
75 years.  Founded in 1908, GM today employs about 327,000
people around the world.  With global headquarters in Detroit,
GM manufactures its cars and trucks in 33 countries including
Mexico.  In 2005, 9.17 million GM cars and trucks were sold
globally under the following brands: Buick, Cadillac, Chevrolet,
GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and
Vauxhall.  GM operates one of the world's leading finance
companies, GMAC Financial Services, which offers automotive,
residential and commercial financing and insurance.  GM's OnStar
subsidiary is the industry leader in vehicle safety, security
and information services.

                        *    *    *

As reported in the Troubled Company Reporter on June 30, 2006,
Standard & Poor's Ratings Services held all its ratings on
General Motors Corp. -- including the 'B' corporate credit
rating and the 'B+' bank loan rating, but excluding the '1'
recovery rating -- on CreditWatch with negative implications,
where they were placed March 29, 2006.

As reported in the Troubled Company Reporter on June 22, 2006,
Fitch assigned a rating of 'BB' and a Recovery Rating (RR) of
'RR1' to General Motor's (GM) new $4.48 billion senior secured
bank facility.  The 'RR1' (recovery of 90%-100%) is based on the
collateral package and other protections that are expected to
provide full recovery in the event of a bankruptcy filing.


GRUPO IUSACELL: Unit Concludes Debt Restructuring With BNP
----------------------------------------------------------
Grupo Iusacell, S.A. de C.V. disclosed that on July 10, 2006,
its subsidiary, Iusacell Infraestructura S.A. de C.V., concluded
the successful restructuring of its debt with the signing of the
corresponding restructuring documentation.

Before the restructuring, Iusacell Infraestructura owed BNP
Paribas (Oslo Branch) US$26.6 million.  This debt consisted of:

(1) a senior amortizing term facility in an outstanding
    principal amount of U.S.$23.2 million, guaranteed by
       the Export Import Bank of Norway or GIEK and due in
       2007; and

(2) a refaccionario loan in an outstanding principal amount
       of US$3.4 million due in 2004.

"The conclusion of this restructuring, along with the agreements
reached with creditors representing a majority in principal
amount of the debt of the company that were previously
announced, represents one more step toward the consensual
restructuring of Iusacell's debt and that of its subsidiaries
and toward the continuous strengthening of our operations,"
Gustavo Guzman, CEO of Iusacell, commented.

The terms of the restructuring signed with BNP/GIEK are:

   -- Guaranteed Facility

      The Guaranteed Facility has a new principal amount of
      US$20.3 million consisting of two tranches that bear
      interest at the 3-month LIBOR rate plus 2.5%. Tranche A
      is in an aggregate principal amount of US$17.4 million
      due in 2010 and began accruing interest on July 10, 2006
      and Tranche B is in an aggregate principal amount of
      US$2.9 million due in 2011 and will begin to accrue
      interest on January 1, 2011.

   -- Refaccionario Loan

      The Refaccionario Loan has a new principal amount of
      US$3.0 million consisting of two tranches that bear
      interest at the 3-month LIBOR rate plus 3.5% -- Tranche A
      is in an aggregate principal amount of US$2.6 million due
      in 2009 and began accruing interest on July 10, 2006 and
      Tranche B is in an aggregate principal amount of
      US$0.4 million due in 2011 and will begin to accrue
      interest on January 1, 2011.

"Iusacell will continue to take firm steps to restructure its
operations and guarantee the continuity of the company.  We
expect all of this to benefit our clients and the development of
the telecommunications industry of our country," Mr. Guzman
concluded.

                    About Grupo Iusacell

Headquartered in Mexico City, Mexico, Grupo Iusacell, S.A. de
C.V. -- http://www.iusacell.com-- is a wireless cellular and
PCS service provider in Mexico with a national footprint.
Independent of the negotiations towards the restructuring of its
debt, Grupo Iusacell reinforces its commitment with customers,
employees and suppliers and guarantees the highest quality
standards in its daily operations offering more and better voice
communication and data services through state-of-the-art
technology, including its new 3G network, throughout all of the
regions in which it operate.

As of Dec. 31, 2005, Grupo Iusacell's stockholders' deficit
widened to MXN2,076,000,000 from a deficit of MXN1,187,000,000
at Dec. 31, 2004.

On July 14, 2006, Gramercy Emerging Markets Fund, Pallmall
LLC and Kapali LLC, owed an aggregate amount of US$55,878,000
filed an Involuntary Chapter 11 Case against Grupo Iusacell.


SECUNDA INT'L: Declares Pricing Terms on Sr. Notes Tender Offer
---------------------------------------------------------------
Secunda International Limited declares certain pricing terms of
its previously announced tender offer and consent solicitation
for any and all of its Senior Secured Floating Rate Notes due
2012 (CUSIP No. 81370FAB4) under the Offer to Purchase and
Consent Solicitation Statement dated June 27, 2006.  As of 5:00
p.m., New York City time, on July 12, 2006, tenders and consents
had been received from holders of US$125.0 million in aggregate
principal amount of the Notes, representing 100.0% of the
outstanding Notes.

The "Tender Offer Yield" is 5.658%, which was determined by
reference to a fixed spread of 50 basis points over the yield of
the 2-3/8% U.S. Treasury Note due August 31, 2006, calculated at
2:00 p.m., New York City time, on July 14, 2006.  Based on the
currently estimated initial settlement date, which is July 20,
2006, and the interest rate for the next interest period, which
is 13.50688%, the total consideration for each US$1,000
principal amount of Notes validly tendered and not withdrawn
prior to the Consent Time of July 12, 2006 would be US$1,048.64,
which includes a consent payment of US$30.00 per US$1,000
principal amount of Notes.  Holders whose Notes were validly
tendered and not withdrawn on or before the Consent Time and are
accepted for purchase by Secunda International will receive
accrued and unpaid interest on the Notes up to, but not
including, the initial settlement date for the Offer, which will
be after the Consent Time but no earlier than July 20, 2006, as
specified by the company.

The tender offer remains open and is scheduled to expire at 5:00
p.m., New York City time, on July 28, 2006, unless extended or
earlier terminated.  The Offer is subject to the satisfaction of
certain conditions, including:

   -- the receipt of tenders from holders of a majority in
      principal amount of the outstanding Notes;

   -- entering into a new credit facility or another financing
      vehicle that provides the company with sufficient cash to
      fund the tender offer and consent solicitation;

   -- the successful pricing of the initial public offering of
      the company's common shares in Canada; and

   -- satisfaction of customary conditions.

The complete terms and conditions of the Offer are described in
the Offer to Purchase, copies of which may be obtained by
contacting the information agent for the offer at:

             D.F. King and Co., Inc.,
             Tel: (212) 269-5550 (collect)
                  (800) 758-5378 (U.S. toll-free)

Additional information concerning the tender offer and consent
solicitation may be obtained by contacting the exclusive dealer
manager and solicitation agent for the tender offer and consent
solicitation at:

             Banc of America Securities LLC
             High Yield Special Products
             Tel: (212) 847-5836 (collect)
                  (888) 292- 0070 (U.S. toll-free)

The supplemental indenture effecting the proposed amendments to
the indenture governing the Notes will be executed promptly.
The proposed amendments, however, will become operative only
when the Company pursuant to the terms of the Offer accepts the
validly tendered Notes for purchase.  In accordance with the
terms of the Offer, tendered Notes may no longer be withdrawn
and delivered consents may not be revoked, unless the company
makes a material change to the terms of the Offer or is
otherwise required by law to permit withdrawal or revocation.

                 About Secunda International

Secunda International Limited provides supply and support
services to the offshore oil and gas industry internationally.
The Company currently owns and operates a fleet of 14 harsh-
weather, multifunctional marine vessels that provide supply,
support and safety services to offshore exploration,
development, production and subsea construction projects.  The
Company primarily serves the North Sea, West Africa and the Gulf
of Mexico and have a leading position in the east coast of
Canada.  The combination of its experienced and highly skilled
workforce and its multifunctional, harsh weather fleet allows
the Company to operate in virtually any part of the world,
including deepwater areas.

                        *     *     *

As reported in the Troubled Company Reporter-Latin America on
June 30, 2006, Standard & Poor's Ratings Services held its 'B-'
long-term corporate credit and senior secured debt ratings on
offshore support vessel provider Secunda International Inc. on
CreditWatch with positive implications, where they were placed
Sept. 29, 2005.




=================
N I C A R A G U A
=================


* NICARAGUA: Mayor Encourages President to Buy Venezuelan Oil
-------------------------------------------------------------
The mayor of Managua, Nicaragua, Dionisio Marenco, urged
President Enrique Bolanos to allow for imports of Venezuelan oil
at preferential prices, under an agreement signed in June by
Petroleos de Venezuela and the Association of Nicaraguan
Municipalities, El Universal reports.

AMUNIC and Petroleos de Venezuela have agreed on the yearly
supply of 10 million barrels of petrol to Nicaragua under
preferential terms -- 60% of the gasoline and diesel purchased
from Venezuela would have a 90-day term at the international
market price.  The rest would have a two-year grace period and a
23-year credit at 1% interest

As reported in the Troubled Company Reporter on June 21, 2006,
the government of Nicaragua prevented Mayor Marenco from
importing Venezuelan gasoline amid a transport crisis.
President Bolanos had said that oil imports from Venezuela
should be agreed to at state level and not through the office of
Managua's mayor.

As reported on July 14, President Bolanos refused to support the
agreement, fearing the political return that would bounce back
to the Sandinista National Liberation Front -- which controls 87
of the 154 city halls of Nicaragua and whose leader Daniel
Ortega was one of the main agents of the accord.

Mr. Marenco asked the president to authorize Petroleos de
Nicaragua to sub rent storage tanks for Venezuelan oil.
Nicaragua has undergone recently a severe crisis of power
supply, El Universal relates.

Petronic manager Jose Garcia Casas said that only the government
could authorize subletting of storage tanks, El Universal says.

                        *    *    *

Moody's Investor Service assigned these ratings to Nicaragua:

                     Rating     Rating Date
                     ------     -----------
   Long Term          Caa1     June 30, 2003
   Senior Unsecured
   Debt                B3      June 30, 2003




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


BANCO LATINAMERICANO: Launches Operations of Clavex LLC
-------------------------------------------------------
Banco Latinoamericano de Exportaciones, S.A., aka Bladex,
launched operations of a wholly-owned subsidiary, Clavex LLC, to
deliver services, technologies and information to financial
institutions throughout Latin America and the Caribbean.

Clavex LLC, based and incorporated in the U.S., will leverage
Bladex's regional expertise and sterling client base in the
Region to deliver solutions pertaining to digital identity
credentials for financial institutions in the Region.

Jaime Rivera, Chief Executive Officer of Bladex, stated, "Clavex
LLC was formed to deliver the best digital identity solutions
required to increase transparency, mitigate risk and bring the
Latin American financialsector up to global standards for
authenticating transactions. Clavex LLC has the exclusivity to
deliver IdenTrust Digital Identity Solutions for the banking
sector and other top services intended to improve and increase
e-commerce and financial transactions to the benefit of those
conducting business in Latin America."

Mr. Rivera added, "I am also pleased to announce that Catherine
McGrail has been named Chief Executive Officer of Clavex LLC.
For the past two years, as Vice President and Head of New
Products for Bladex, she spearheaded our entry into the digital
identity business and was the driving force behind our
successful partnership with IdenTrust.  Her knowledge and
experience in Latin American financial services products and
vendors will be pivotal to the success of Clavex LLC."

Headquartered in Panama City, Panama, Banco Latinoamericano de
Exportaciones, S.A. aka Bladex -- http://www.bladex.com-- is a
supranational bank originally established by the Central Banks
of Latin American and Caribbean countries to promote trade
finance in the Region. Based in Panama, its shareholders include
central banks and state- owned entities in 23 countries in the
Region, as well as Latin American and international commercial
banks, along with institutional and retail investors.  Through
December 31, 2005, Bladex had disbursed accumulated credits of
over US$135 billion.

                        *    *    *

As reported on April 7, 2006, Moody's affirmed the following
ratings for Bladex:

   -- Bank Financial Strength Rating: D-minus, change to
      positive outlook from stable;

   -- Long Term Foreign Currency Deposit Rating: Baa3, with
      stable outlook;

   -- Short Term Foreign Currency Deposit Rating: Prime-3;

   -- Foreign Currency Senior Unsecured Rating: Baa3, with
      stable outlook; and

   -- Foreign Currency Issuer Rating: Baa3, with stable outlook.


SOLO CUP: Susan H. Marks Resigns as Chief Financial Officer
-----------------------------------------------------------
Solo Cup Company disclosed that Executive Vice President and
Chief Financial Officer Susan H. Marks decided to leave the
company, effective July 11, 2006, to pursue other interests.

The Company disclosed that it has engaged Heidrick & Struggles
International, Inc., an executive search firm, to undertake a
nationwide search for Ms. Marks' successor.  Robert Korzenski,
president and chief operating officer said "On an interim basis,
we are fortunate to have an experienced and capable accounting
and finance department within the company to facilitate a smooth
transition upon the appointment of a new CFO".

Headquartered in Highland Park, Illinois, Solo Cup Company --
http://www.solocup.com/-- manufactures disposable foodservice
products for the consumer and retail, foodservice, packaging,
and international markets.  Solo Cup has broad expertise in
plastic, paper, and foam disposables and creates brand name
products under the Solo, Sweetheart, Fonda, and Hoffmaster
names.  The Company was established in 1936 and has a global
presence with facilities in Asia, Canada, Europe, Mexico, Panama
and the United States.

                        *    *    *

As reported in the Troubled Company Reporter on Apr. 4, 2006,
Moody's Investors Service assigned ratings on Solo Cup Company's
US$80 million senior secured second lien term loan due 2012 at
B3; US$150 million senior secured revolving credit facility
maturing Feb. 27, 2010, at B2; US$638 million senior secured
term loan B due Feb. 27, 2011, at B2; US$325 million 8.5% senior
subordinated notes due Feb. 15, 2014, at Caa1; and Corporate
Family Rating at B2.


* PANAMA: Trans-Caribbean Pipeline to Include Fiber Optic Cable
---------------------------------------------------------------
The construction of a US$335-million natural gas pipeline that
will connect Venezuela, Colombia and Panama will include a fiber
optic cable to help improve communications among the three
nations, according to a report from El Universal.

Last week, the presidents of Venezuela, Colombia and Panama
formally inaugurated the construction of the pipeline.

Venezuela's state-run oil firm, Petroleos de Venezuela will fund
the construction of the pipeline.  The 225 km, 150 million cubic
feet gas pipeline is expected to become operational in 2007.

According to Petroleos de Venezuela, 10% of its total investment
will be used to fund social projects in areas where the pipeline
will be laid.

                        *    *    *

Fitch Ratings assigned these ratings on Panama:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling    BBB      Apr.  8, 2005
   Long Term IDR      BB+      Dec. 14, 2005
   Short Term IDR       B      Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating     BB+      Dec. 14, 2005




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


* PARAGUAY: Foreign Bond Issues May be Bought by Venezuela
----------------------------------------------------------
The Venezuelan government may purchase up to US$100 million of
Paraguay's bonds in order to set-up a development bank in
Paraguay, El Universal reports, citing Venezuelan Finance
minister Nelson Merentes.

Venezuela is "assessing purchase of such bonds to create an
institution in that country," the Venezuelan finance minister
told El Universal. The operation would be handled by the
Venezuelan Bank for Economic and Social Development -- Bandes.

The government, the officiald disclosed to El Universal, plans
to establish a branch of Bandes in Paraguay, as it did in
Uruguay, where the Venezuelan Government purchased a savings
cooperative that is to grant loans as of July 24.

Additionally, Venezuela may include buying debt instruments from
the Itaipu hydro-electric project.  However, the proposed Itaipu
bond sale may meet resistance from Brazilian officias since the
project is jointly run by Brazil and Paraguay.

                        *    *    *

Moody's assigned these ratings on Paraguay:

     -- CC LT Foreign Bank Deposit, Caa2
     -- CC LT Foreign Curr Debt, Caa1
     -- CC ST Foreign Bank Deposit, NP
     -- CC ST Foreign Currency Debt, NP
     -- LC Currency Issuer Rating, Caa1
     -- FC Curr Issuer Rating, Caa1
     -- Local Currency LT Debt, WR

                        *    *    *

Standard & Poor's assigned these ratings on Paraguay:

     -- Foreign Currency LT Debt B-
     -- Local Currency LT Debt   B-
     -- Foreign Currency ST Debt C
     -- Local Currency ST Debt   C




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


ADELPHIA COMMS: GE Capital Wants Mercury to Decide on Contract
--------------------------------------------------------------
Mercury Communications, Inc., an Adelphia Communications
Corp. debtor-affiliate, entered into a prepetition Aircraft
Lease Agreement with General Electric Capital Corp., in which
Mercury leases a 1989 Cessna Citation III corporate jet from
General Electric.

Pursuant to the Lease Agreement, Mercury:

    -- is obligated to pay term rent of US$57,210 on the 18th
       day of each month;

    -- is obligated to properly maintain the Aircraft;

    -- had an opportunity to exercise an early purchase option
       or US$4,540,268 on December 18, 2002; and

    -- has the opportunity to purchase the Aircraft at "fair
       market value" on December 18, 2006, the Lease's
       expiration date.

The Lease is subject to a corporate guaranty by Adelphia Cable
Corp., Inc., and is subject to a prepetition default of
US$57,210.

In June 2006, the Court approved the ACOM Debtors' sale of
substantially all of their assets to Time Warner Cable NY, LLC,
and Comcast Corp., and confirmed the Joint Venture Plan of
Century-TCI Debtors and Parnassos Debtors.

Susan G. Boswell, Esq., at Quarles & Brady Streich Lang LLP, in
Tucson, Arizona, contends that since neither of the ACOM
Debtors' purchasers seeks to assume the Lease, it is clear that
the Lease will be rejected eventually.  The result of the
approved Sale Motion and the Joint Venture Plan is that the
ultimate rejection of the Lease will be postponed indefinitely,
Ms. Boswell says.

Ms. Boswell tells the Court that the ACOM Debtors continue to
use the Aircraft, which also continues to depreciate in value.
The arrangement unfairly places substantially all of the risk
associated with the market or potential damage to the Aircraft
on General Electric, Ms. Boswell complains.

Accordingly, General Electric asks the Court to set a date by
which the ACOM Debtors must either assume or reject the Aircraft
Lease.

Based in Coudersport, Pa., Adelphia Communications Corp.
(OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest
cable television company in the country.  Adelphia serves
customers in 30 states and Puerto Rico, and offers analog and
digital video services, high-speed Internet access and other
advanced services over its broadband networks.  The Company and
its more than 200 affiliates filed for Chapter 11 protection in
the Southern District of New York on June 25, 2002.  Those cases
are jointly administered under case number 02-41729.  Willkie
Farr & Gallagher represents the ACOM Debtors.
PricewaterhouseCoopers serves as the Debtors' financial advisor.
Kasowitz, Benson, Torres & Friedman, LLP, and Klee, Tuchin,
Bogdanoff & Stern LLP represent the Official Committee of
Unsecured Creditors.  (Adelphia Bankruptcy News, Issue No. 139;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


ADELPHIA COMMS: JPMorgan Will Appeal Comcast-Time Warner Sale OK
----------------------------------------------------------------
JPMorgan Chase Bank, N.A., as administrative agent under the
Second Amended and Restated Credit Agreement dated
Dec. 19, 1997, with FrontierVision Operating Partners, L.P., as
borrower, notifies the U.S. Bankruptcy Court for the Southern
District of New York that it will take an appeal to the U.S.
District Court for the Southern District of New York from Judge
Gerber's approval of the sale of substantially all of the assets
of Adelphia Communications Corp. and its debtor-affiliates to
Comcast Corp. and Time Warner Cable NY LLC.

JPMorgan wants the District Court to review whether the
Bankruptcy Court erred, as a matter of law, in concluding that
the sale of substantially all of the assets of the
FrontierVision Debtors was authorized under Section 363(b) of
the Bankruptcy Code outside of a Chapter 11 plan.

As reported in the Troubled Company Reporter on June 26, 2006,
Judge Gerber allowed the ACOM Debtors to restructure the sale of
substantially all of their assets to Time Warner and a portion
of its asset sale to Comcast.

According to Judge Gerber, the Debtors have demonstrated a
compelling and sound business justification for the Additional
Buyer Provisions set forth in the Amended Purchase Agreements.

Based in Coudersport, Pa., Adelphia Communications Corp.
(OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest
cable television company in the country.  Adelphia serves
customers in 30 states and Puerto Rico, and offers analog and
digital video services, high-speed Internet access and other
advanced services over its broadband networks.  The Company and
its more than 200 affiliates filed for Chapter 11 protection in
the Southern District of New York on June 25, 2002.  Those cases
are jointly administered under case number 02-41729.  Willkie
Farr & Gallagher represents the ACOM Debtors.
PricewaterhouseCoopers serves as the Debtors' financial advisor.
Kasowitz, Benson, Torres & Friedman, LLP, and Klee, Tuchin,
Bogdanoff & Stern LLP represent the Official Committee of
Unsecured Creditors.  (Adelphia Bankruptcy News, Issue No. 139;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


MAXXAM INC: Can Sell Up to 3.5 Million Kaiser Aluminum Shares
-------------------------------------------------------------
MAXXAM Inc. recently contacted Kaiser Aluminum Corporation and
its debtor-affiliates about selling up to 3,500,000 shares of
Kaiser Aluminum Corp. stock.

Kaiser Aluminum has determined that the proposed disposition
would not adversely impact its tax attributes.

Accordingly, Kaiser Aluminum and MAXXAM have reached an
agreement to modify their July 23, 2002 stipulation and agreed
order to permit MAXXAM's proposed disposition.

At the parties' behest, the U.S. Bankruptcy Court for the
District of Delaware authorizes MAXXAM to sell up to 3,500,000
shares of its KAC stock.

Judge Fitzgerald clarifies that other than the proposed sale,
MAXXAM will continue to be prohibited from disposing of any of
its remaining KAC stock prior to a hearing pursuant to its
agreement with KAC.

                     About Kaiser Aluminum

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company filed for chapter 11 protection on
Feb. 12, 2002 (Bankr. Del. Case No. 02-10429), and has sold off
a number of its commodity businesses during course of its cases.
Corinne Ball, Esq., at Jones Day, represents the Debtors in
their restructuring efforts. Lazard Freres & Co. serves as the
Debtors' financial advisor.  Lisa G. Beckerman, Esq., H. Rey
Stroube, III, Esq., and Henry J. Kaim, Esq., at Akin, Gump,
Strauss, Hauer & Feld, LLP, and William P. Bowden, Esq., at
Ashby & Geddes represent the Debtors' Official Committee of
Unsecured Creditors.  The Debtors' Chapter 11 Plan became
effective on July 6, 2006.  On June 30, 2004, the Debtors listed
US$1.619 billion in assets and US$3.396 billion in debts.

                       About MAXXAM Inc.

Headquartered in Houston, Texas, MAXXAM Inc. (AMEX: MXM)
operates businesses ranging from aluminum and timber products to
real estate and horse racing.  MAXXAM's top revenue source is
Kaiser Aluminum, which has been in Chapter 11 bankruptcy since
2002.  MAXXAM's timber subsidiary, Pacific Lumber, owns about
205,000 acres of old-growth redwood and Douglas fir timberlands
in Humboldt County, California.  MAXXAM's real estate interests
include commercial and residential properties in Arizona,
California, Texas, and Puerto Rico.  The Company also owns the
Sam Houston Race Park, a horseracing track near Houston.
Chairman and CEO Charles Hurwitz controls 77% of MAXXAM.

                        *    *    *

Maxxam's balance sheet at March 31, 2006 showed a US$671.3
million total stockholders' deficit resulting from US$1,013.1
million in total assets and US$1,684.4 million in total
liabilities.




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


PETROLEOS DE VENEZUELA: Affirms Intent to Refine Ecuadorian Oil
---------------------------------------------------------------
Venezuela's foreign vice-minister for Latin America and the
Caribbean, Pavel Rondond, said during his visit in Quito, that
Venezuela will refine Ecuadorian oil using Petroleos de
Venezuela SA's Paraguana Refining Complex.

"Ecuador only needs to say when does it want it, and will have
it," the official was quoted by El Universal as saying.  Vice-
minister Rondond visited Ecuador to hold bilateral talks
concerning education, health, communications and agriculture,
among others.

"Venezuela is most interested in materializing plans
immediately; our technicians are ready," the Vice-Minister told
the Associated Press.

"Our oil sector has advised us that Venezuela is ready to
implement the agreement; first of all, because we have no
problem to refine oil. We have the refinery and also the
products for exchange."

                     Ecuador's Deadline

"So far, we do not have a clear idea on the benefits for our
country. At first, Venezuela talked about (savings for) US$179
million, but we do not have any written instrument confirming
such a figure," Ecuadorian energy minister Ivan Rodriguez told a
local TV network.

According to Reuters, Petroleos de Venezuela is required to
clarify the economic advantages for Ecuador of the proposed
agreement to trade crude oil for by-products otherwise the pact
will be cancelled.

"We are waiting until Wednesday for the Venezuelan proposal.
Then, we are going to consider the possibility to hold an
international bidding on the whole production from Block 15 up
to February, so that all state oil holdings can participate,
including Pdvsa, and those from Indonesia, South Korea, China,
Brazil and Colombia, which are interested in our oil," the
minister was quoted by El Universal as saying.

Petroleos de Venezuela SA 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 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, was also upgraded to
'BB+' from 'BB'.  In addition, Fitch has assigned PDVSA a
'AAA(ven)' national scale rating.  Fitch said the Rating Outlook
is Stable.  Both rating actions followed Fitch's November 2005
upgrade of Venezuela's sovereign rating.


PETROLEOS DE VENEZUELA: Inks Eight Joint Venture Agreements
-----------------------------------------------------------
The Venezuelan Petroleum Corp., a subsidiary of state-run oil
firm Petroleos de Venezuela, signed eight joint venture
agreements for exploitation of hydrocarbons in Venezuela, which
are to replace the so-called operational agreements, El
Universal reports.

Eulogio del Pino, a director at Petroleos de Venezuela, told the
official news agency ABN that the remaining 13 joint ventures
would be formally organized within the next two weeks.

Among the companies that signed joint venture agreements in
April are:

      * Spain's Repsol YPF,
      * UK's BP,
      * Japanese firm Teikoku,
      * local unit of Canada's PetroFalcon Vinccler Oil & Gas,
      * Suelopetrol,
      * Inemaka
      * Open,
      * Petroleo Brasileiro SA,
      * China's CNPC,
      * Chevron Corp.,
      * Anglo-Dutch major Shell (NYSE: RDS-B),
      * Argentina's CGC,
      * Tecpetrol,
      * France's Perenco,
      * Harvest and
      * France's Hocol.

Under the joint ventures, Petroleos de Venezuela gets at least a
60% stake.

Mr. del Pino told Reuters that over the next three years
Venezuela expects to double the Orinoco extra-heavy crude oil
production with the organization of the new joint ventures.
Under this scheme, Venezuela is to operate four projects, namely
Cerro Negro, Hamaca, Petrozuata and Sincor in cooperation with
corporations including Norwegian Statoil, French Total and US
firms ExxonMobil, ConocoPhillips and Chevron.

"We are likely to double output in three years to 1.1 billion
bpd in the same areas we have today," del Pino was quoted by El
Universal as saing.

Furthermore, Mr. del Pino told ABN that they consider acquiring
a stake in an Indonesia-based refinery, which is expected to be
the largest in Southeast Asia.

Petroleos de Venezuela SA aka 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, 2006, Fitch Ratings 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, was also 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.


* VENEZUELA: Natural Gas Pipeline to Include Fiber Optic Cable
--------------------------------------------------------------
The construction of a US$335-million natural gas pipeline that
will connect Venezuela, Colombia and Panama will include a fiber
optic cable to help improve communications among the three
nations, according to a report from El Universal.

Last week, the presidents of Venezuela, Colombia and Panama
formally inaugurated the construction of the pipeline.

Venezuela's state-run oil firm, Petroleos de Venezuela will fund
the construction of the pipeline.  The 225 km, 150 million cubic
feet gas pipeline is expected to become operational in 2007.

According to Petroleos de Venezuela, 10% of its total investment
will be used to fund social projects in areas where the pipeline
will be laid.

                        *    *    *

Venezuela's foreign currency long-term debt is rated B1 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.


* VENEZUELA: Remedies Natural Gas Shortage Through Pipeline
-----------------------------------------------------------
Venezuela has been experiencing a deficit of natural gas that
had affected oil operations for years, Dow Jones Newswire
reports.

The country, says Dow Jones, wants to provide the Latin American
region with natural gas reserves through a transcontinental
grid.  However, it has just started making efforts to resolve a
domestic shortage of the fuel.

Dow Jones relates that Venezuela's President Hugo Chavez met
with his Colombian and Panamanian counterparts last weekend to
celebrate the launching of a 225-kilometer gas pipeline that
will begin supplying the Western oil fields of Venezuela with
gas from Colombia by March 2007.

According to Dow Jones, the construction of the pipeline, which
would cost US$335 million, emphasizes Venezuela's enthusiasm for
natural gas as well the urgent need for the fuel.

Chevron Corp.'s offshore fields would supply the Colombian gas,
Dow Jones says.  It will allow Petroleos de Venezuela, the
state-owned oil company of Venezuela, to save US$30 million per
month by replacing the diesel it currently burns to power its
oil activities.

Dow Jones notes that Venezuela, once it resolves its natural gas
shortage, plans to start exporting to Colombia and Panama in
2009.

Other than the Colombia pipeline, Petroleos de Venezuela plans
exports to South American markets from Brazil to Argentina
through a transnational pipeline, Dow Jones emphasizes.

However, analysts doubt Petroleos de Venezuela will be able to
supply all of its export projects and end the domestic deficit
at the same time, despite the company's improving performance,
Dow Jones says.

Miguel Octavio, an analyst with BBO Servicios Financieros, told
Dow Jones, "All these gas pipeline projects are strange, because
Venezuela does not have enough gas (production) to fill them."

Dow Jones underscores that Petroleos de Venezuela needs the gas
for existing oil operations and to power expansion plans at the
Orinoco heavy oil basin, in which Venezuela aims to increase
production over the next six years.

Dow Jones notes that Petroleos de Venezuela has been more eager
to encourage private entities to produce gas than oil.
Venezuela wants to increase natural gas production to 11.5
billion cubic feet per day by 2012, with over US$16 billion in
investment from Petroleos de Venezuela and private firms over
the next six years.

However, Mr. Octavio told Dow Jones that Petroleos de Venezuela
has not been meeting its oil and gas investment targets in
recent years.

To meet its natural gas output target, the company would have to
make a lot of exploration.  Petroleos de Venezuela is not
investing enough and private firms cannot make up the balance
entirely on their own, Dow Jones notes, citing Mr. Octavio.

Venezuela's foreign currency long-term debt is rated B1 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.


* VENEZUELA: Saving US$40MM Monthly in Natural Gas Imports
----------------------------------------------------------
Rafael Ramirez, the Venezuelan minister of energy and oil, told
Business News Americas that Venezuela will save US$40 million
monthly by using Colombian natural gas for thermal generation
instead of Venezuela's own liquid fuels.

BNamericas reports that Venezuela's thermo plants -- Ramon
Laguna and Rafael Urdaneta -- in Maracaibo burn 17,000 barrels a
day of diesel, which can be substituted with Colombian gas.
Government figures show that due to a lack of natural gas, the
two plants are operating below.  Venezuela needs to employ all
of its extra generation capacity to meet an increase in
electricity demand causing electricity interruptions.

The natural gas from Colombia would be transported to Venezuela
through the planned 225km Gasoducto Transcaribeno natural gas
pipeline linking the two nations, BNamericas says.

Minister Ramirez said in a statement, "With a diameter of 26
inches, the Gasoducto Transcaribeno will have capacity during
its first stage -- estimated from four to seven years -- to
import 150 million cubic feet a day of gas."

Once Venezuela develops several ongoing exploration and
production projects, the country -- which will initially import
Colombian gas -- could reverse the situation and instead export
gas to Colombia, BNamericas states.

Venezuela's foreign currency long-term debt is rated B1 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.


                         ***********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA.  Marjorie C. Sabijon, Sheryl Joy P. Olano, Stella
Mae Hechanova, and Christian Toledo, Editors.

Copyright 2006.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
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