TCRLA_Public/170810.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

               Thursday, August 10, 2017, Vol. 18, No. 158


                            Headlines



A R G E N T I N A

ALBANESI SA: Fitch Affirms 'B' Long-Term IDR; Outlook Stable


B O L I V I A

BISA LEASING: Moody's Alters Outlook to Stable & Affirms Ba3 CFR


B R A Z I L

ESSENCIS SOLUCOES: Moody's Withdraws B3/B1 Corporate Family Rating
NATURA COSMETICOS: S&P Lowers Global Scale CCR to 'BB'


D O M I N I C A N   R E P U B L I C

DOMINICAN REPUBLIC: No New Taxes, Control on Imports to Resell
DOMINICAN REPUBLIC: July Prices Climb 0.18%, Paced by Foods
DOMINICAN REPUBLIC: Regulates Web-Bought Imported Goods for Resale


P U E R T O    R I C O

PUERTO RICO: Gibson Dunn Files Challenge to Oversight Board
PUERTO RICO: Oversight Board Moves to Implement Fiscal Plan
PUERTO RICO: Committee Tasked to Conduct Debt Probe Appointed


V E N E Z U E L A

CITGO PETROLEUM: US Sanctions on Venezuela Won't Affect Operations
VENEZUELA: Regional Governments Reject New Assembly


                            - - - - -



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


ALBANESI SA: Fitch Affirms 'B' Long-Term IDR; Outlook Stable
------------------------------------------------------------
Fitch Ratings has affirmed Albanesi S.A.'s Long-Term Foreign and
Local Currency Issuer Default Ratings (IDRs) at 'B' and 'BB-',
respectively. The Rating Outlook is Stable.

Fitch has also affirmed Albanesi's USD250 million senior unsecured
bond ratings at 'B+/RR3'. The bonds have been co-issued with
Central Termica Roca (CTR) and Generacion Mediterranea SA (GEMSA).
GEMSA is a subsidiary of Albanesi S.A. The notes are guaranteed by
Albanesi S.A. Each of the issuers and Albanesi S.A. are jointly
and severally liable for any payment obligations under the notes.
Fitch has also affirmed and withdrawn the senior unsecured bond
rating of Generacion Frias S.A. (GFSA) at 'B+/RR3', as the entity
has been merged into GEMSA.

Albanesi's ratings reflect the Argentine electricity industry's
high regulatory risk, although, this risk has slightly diminished
due to recent regulatory changes. The ratings also reflect the
company's counterparty risk to CAMMESA as main off-taker and its
improving metrics supported by the company's relatively stable and
predictable cash flow generation. Finally, the ratings also
reflect the macro-economic environment, including high inflation
and steep currency devaluation and implicit support and synergies
with natural gas trading and distribution sister company, Rafael
G. Albanesi (RGA). The company's 'BB-' Long-term Local Currency
IDR reflects the expected conservative financial structure coupled
with the country's high capital investments needs in the sector in
order to reduce the energy deficit.

Albanesi's 'B' Long-term Foreign Currency IDR is constrained by
the Republic of Argentina's 'B' country ceiling, which limits the
foreign currency rating of most Argentine corporates. Fitch's
Country Ceilings are designed to reflect the risks associated with
sovereigns placing restrictions upon private sector corporates,
which may prevent them from converting local currency to any
foreign currency under a stress scenario, and/or may not allow the
transfer of foreign currency abroad to service foreign currency
debt obligations. Since elected in December 2015, the Mauricio
Macri administration removed FX controls introduced in 2011 and
increased the flexibility of the Argentine peso, which should
contribute towards improving the capacity of the economy to absorb
external shocks and relieve pressure on international reserves.

KEY RATING DRIVERS

Improving Credit Metrics: Albanesi's cash flow generation is
relatively stable and predictable. As of December 2016, 80% of the
company's EBITDA was related to long-term take or pay contracts
with CAMMESA denominated in U.S. dollars under the Resolution
220/07 regulatory framework. Additionally, approximately 88% of
the company's revenues were denominated in U.S. dollars. The
Albanesi group, including CT Roca, operates eight power plants
located in multiple provinces of Argentina, benefitting from
geographical diversification and good access to fuel and the
Sistema Argentino de Interconexion (SADI). As of December 2016,
Albanesi's total debt/EBITDA ratio stood at 6.0x, which Fitch
considers the company's peak leverage before entering into a
period of rapid deleveraging, decreasing below 3.0x by the end of
2018 when the additional projects start operations.

Improving Regulatory Risk: Fitch believes the recent resolutions
implemented by the new government reflect a trend for less
government interference and discretion in the power generation
sector. Albanesi operates in a highly strategic sector in which
the government has historically had a role as the price/tariff
regulator and had full control over the subsidies for industry
players. Since 2013, the Secretariat of Energy introduced material
changes to the structure and operation of the wholesale
electricity market (WEM). Since 2013, the tariffs have almost
doubled. Additionally, the Ministry of Mining and Energy, under
Resolution 22/2016 adjusted the spot price tariffs for energy
sales under the Energia Base framework. Under Resolution 19/2017,
the regulator dollarized tariffs and set a schedule to increase
capacity prices to USD9.6/MWh, from the previously equivalent of
approximately USD3.8/MWh, by November 2017 and onwards.

Counterparty Exposure: Albanesi depends on payments from Compania
Administradora de Mercado Mayorista Electrico S.A. (CAMMESA),
which can be volatile since the agency is dependent on the
national government for funds to make payments. Electric companies
in Argentina are not only exposed to delays in the payment of
CAMMESA, but also to risks in fuel supply, as the government's
agency centralizes the country's fuel imports. CAMMESA's
increasing obligations relative to its revenues significantly
increased discretionary payments to suppliers. The new resolutions
intend to reduce CAMMESA's deficit to support industry
sustainability in order to balance the supply/demand dynamics.

Albanesi's take-or-pay capacity contracts somewhat mitigates gas
supply risk. Furthermore, the company's exposure to a shortage in
fuel is partially mitigated by the role of sister company, R.G.
Albanesi S.A. (RGA), as the main natural gas trader of the
country, supplying gas if needed to the companies within the
Albanesi group.

DERIVATION SUMMARY

Albanesi is constrained by Argentina's country ceiling..
Albanesi's metrics and expected capital structure are, however,
healthy when compared to its local and regional peers. Capex,
similarly rated 'B', benefits from vertical integration, which
offsets its higher leverage through the rating cycle (above 5.0x).
Albanesi, currently in a period of expansion has similarly high
leverage, but is expected to delever quickly to around 2.0x.

Regionally, the Peruvian generator, Orazul Energy Egenor S. en C.
por A. (rated 'BB'/Stable Outlook) shows a weaker capital
structure, with leverage above 5.0x expected through the rating
horizon, mitigated by its asset diversification. Kallpa Generacion
S.A. ('BBB-' /Stable Outlook) is one of Peru's largest thermal
generators with leverage consistently below 3.0x. Its expected
merger with sister company Cerro del Aguila S.A. ('BBB- '/ Stable
Outlook) (making the entity Peru's largest privately-owned
generation company) will temporarily drive leverage to the 5.0x
level given its recent start-up of operations, before settling
around the 3.5x level in the next few years.

KEY ASSUMPTIONS

Fitch's key assumptions within the agency's rating case for the
issuer include:

-- Installed capacity for Albanesi S.A and guarantors of 1042MW
    currently, increasing by 310MW from projects under
    construction. Main increased in installed capacity due to
    Ezeiza 1&2 (150MW), Independencia 1&2 (100MW), and CT Roca
    (60MW);
-- All additional installed capacity is contracted under Res-220
    and 21/2016;
-- Approximately 60% of the installed capacity contracted under
    Res-220/21 in 2016 increasing to 70% by 2018;
-- Res 220 prices and Energia plus prices remaining flat;
-- Base energy prices will increase to USD9.6/MWh by 2019;
-- Average FX rate of $16.45, $19.17 and $21.15 for 2017 to 2019.

RATING SENSITIVITIES

Future Developments That May, Individually or Collectively, Lead
to Positive Rating Action

- An upgrade to the ratings of Argentina could result in a
   positive rating action.

Future Developments That May, Individually or Collectively, Lead
to Negative Rating Action

- A change in the company's contractual mix and / or
   deterioration on the regulatory framework that could affect the
   company's ability to generate revenues under the Energia plus
   and Res 220/07 frameworks.
- Given Albanesi's high dependence on the subsidies by CAMMESA
   from the Treasury, any further weakening of Argentina's fiscal
   accounts could have a negative impact on the company's
   collections / cash flow;
- A delay in the expected deleveraging process and/or significant
   payment delays from CAMMESA;
- Finally, a downgrade of Argentina's ratings would result in a
   downgrade of Albanesi's ratings, given that the company's
   ratings are constrained by the sovereign's credit quality.

LIQUIDITY

The company maintains only a nominal cash account, which as of
year-end 2016 and 2015 was USD33 million and USD2 million,
respectively. This is a common practice among Argentine
corporates. The company's liquidity is supported by its stable and
predictable cash flow generation derived from its contractual
structure. Albanesi's gross leverage in 2016 was 6.0x, with
interest coverage of 3.8x. The company's current expansion phase
has driven debt higher, resulting in what Fitch expects to be
Albanesi's peak leverage before entering a period of rapid
deleveraging to below 3.0x by 2018. At the same time, this
expansion, which is adding approximately 310MW of installed
capacity in the next year, has temporarily pressured interest
coverage, which Fitch expects to rapidly improve back to around
3.0x within the rating horizon.

FULL LIST OF RATING ACTIONS

Fitch has affirmed the following ratings:

Albanesi S.A.

-- Long-Term Foreign Currency Issuer Default Rating at 'B';
-- Long-Term Local Currency IDR at 'BB-';

Central Termica Roca S.A.

-- International senior unsecured bond rating at 'B+/RR3';

Generacion Mediterranea S.A.

-- International senior unsecured bond rating 'B+/RR3'.

Fitch has affirmed and withdrawn the following rating:

Generacion Frias S.A.:

-- International senior unsecured bond rating at 'B+/RR3'.



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


BISA LEASING: Moody's Alters Outlook to Stable & Affirms Ba3 CFR
----------------------------------------------------------------
Moody's Latin America Agente de Calificacion de Riesgo S.A. (MLA)
has today changed the outlook to stable, from negative, on certain
ratings of Bolivian leasing companies BISA Leasing S.A. and BNB
Leasing S.A. In addition, Moody's affirmed all of the issuers'
ratings and assessments. These actions follow the change in
outlook to stable, from negative, on both leasing companies'
affiliated banks (Banco BISA S.A. and and Banco Nacional de
Bolivia S.A., respectively), on August 2, 2017.

The following ratings assigned to BISA Leasing S.A. were affirmed:

- Long term local currency corporate family, long term local and
   foreign currency issuer, and local and foreign currency senior
   unsecured debt ratings of Ba3 with stable outlook, previously
   negative.

- Bolivian national scale local and foreign currency issuer, and
   local and foreign currency senior unsecured debt ratings of
   Aaa.bo with stable outlook.

- Foreign currency senior unsecured debt program rating of (P)Ba3

- Bolivian national scale foreign currency senior unsecured debt
   program rating of Aaa.bo

- Local and foreign currency other short term ratings of NP

- Bolivian national scale local and foreign currency other short
   term ratings of BO-1

The following ratings and assessments assigned to BNB Leasing S.A.
were affirmed:

- Long term local and foreign currency corporate family, and
   local currency senior unsecured debt ratings of Ba3 with stable
   outlook, previously negative.

- Bolivian national scale long term local and foreign currency
   corporate family, and local currency senior unsecured debt
   ratings of Aaa.bo with stable outlook.

- Local and foreign currency senior unsecured debt program rating
   of (P)Ba3

- Bolivian national scale local and foreign currency senior
   unsecured debt program ratings of Aaa.bo

RATINGS RATIONALE

The rating actions were prompted by the change in outlook to
stable, from negative, on BISA Leasing S.A. and BNB Leasing S.A.
affiliated banks, Banco BISA S.A. (BCA ba3) and Banco Nacional de
Bolivia S.A. (BCA ba3), respectively. The outlook change on the
banks was in turn derived from the recent change in outlook to
stable, from negative, on Bolivia's sovereign bond rating, owing
to stabilizing fiscal and current account deficits which suggest
that the impact of lower hydrocarbon prices on the sovereign's
credit profile has been contained; and Moody's expectation that
Bolivia's growth, fiscal and external metrics, although weakened,
are likely to remain consistent with its Ba3 rating.

BISA Leasing S.A. and BNB Leasing S.A.'s ratings reflect the
companies' stand-alone credit profiles of b1 and incorporates
Moody's assessment of a high likelihood of support deriving from
its affiliated banks, Banco BISA S.A. and Banco Nacional de
Bolivia S.A., resulting in a one-notch uplift from the unsupported
stand-alone credit profiles. According to Bolivian Financial
Services law passed in 2013 and other subsequent regulations,
starting August 2017 banks are no longer allowed to own non-
banking subsidiaries; instead, ownership control of these entities
are to be transferred to a holding company. Banco Nacional de
Bolivia S.A. has already transferred ownership of BNB Leasing S.A.
to BNB Corporacion S.A., while BISA Leasing S.A. is in the process
of being transferred to Grupo Financiero BISA S.A., the holding
company that will also control Banco BISA S.A. Notwithstanding the
change in corporate structure, by which banks become sister
companies to the leasing companies, Moody's continues to
incorporate a high probability of support from the affiliated
banks to the leasing companies in time of stress, given their
operational and commercial integration, as well as their brand
sharing. Also, as this change was completely driven by a
regulatory change, it does not signal a change in the strategic
importance of these companies for the affiliated banks.

BISA Leasing S.A. b1 standalone profile is underpinned by its
leadership in the Bolivian leasing market, where it holds a 59%
market share, and its adequate capital and liquidity levels. These
strengths are partially offset by the growing level of
restructured loans in its portfolio, which particularly increased
in 2016, and could imply higher problem loans in the following
quarters.

BISA Leasing S.A. is headquartered in La Paz, Bolivia. As of June
2017, the company had total assets of Bs. 438.9 million and equity
of Bs. 46.2 million.

BNB Leasing S.A. b1 standalone profile takes into account the
company's relatively strong capital and liquidity levels, being
offset by a declining market presence, evidenced by the decrease
in its market share from 26% in 2014 to 22% as of June 2017.

BNB Leasing S.A. is headquartered in La Paz, Bolivia. As of June
2017, the company had total assets of Bs. 145.6 million and equity
of Bs. 37.4 million.

WHAT COULD CHANGE THE RATING -- UP/DOWN

As a result of the credit inter-linkages between the affected
leasing companies and their bank affiliates, the companies'
ratings are likely to be downgraded if and when the banks' ratings
are downgraded. Conversely, the leasing companies' ratings could
face upward pressure if the banks' ratings were improved.

The principal methodology used in these ratings was Finance
Companies published in December 2016.



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


ESSENCIS SOLUCOES: Moody's Withdraws B3/B1 Corporate Family Rating
------------------------------------------------------------------
Moody's America Latina has withdrawn Essencis Solucoes Ambientais
S.A.' B3/B1.br corporate family rating, the B3/B1.br ratings of
its senior secured debentures due in 2023 and the stable outlook.

RATINGS RATIONALE

Moody's has withdrawn the rating for its own business reasons.

Headquartered in Sao Paulo, Brazil, Essencis Solucoes Ambientais
S.A. is a major provider of environmental services and waste
management for industrial and public customers in Brazil. In 2016,
the company reported net revenues of BRL 280 million (USD 80
million), coming mainly from operations in sanitary landfills
(62%), operations at clients (13%), environmental services (7%),
co-processing (6%), sale of byproducts (4%), incineration (3%),
waste-to-energy (1%) and others (4%). Essencis is 100% owned by
Solv° Participacoes S.A. (Solv°). Solv° operates in Brazil,
Bolivia, Argentina and Peru through approximately 60 subsidiaries
offering mainly environmental services and waste management to
public and private customers.


NATURA COSMETICOS: S&P Lowers Global Scale CCR to 'BB'
------------------------------------------------------
S&P Global Ratings lowered its global scale corporate credit
rating on Natura Cosmeticos S.A. (Natura) to 'BB' from 'BB+' and
its national scale corporate credit and issue-level ratings to
'brA+' from 'brAA'. S&P said, "We removed the ratings from
CreditWatch negative, where we placed them on June 9, 2017. The
outlook on both scales is now negative. We're keeping our recovery
rating of '3' on Natura's senior unsecured debt, reflecting our
expectation of meaningful recovery (50%).

"The downgrade reflects the sharp increase in Natura's leverage
once it completes the acquisition of TBS, for which the company
will raise R$3.7 billion in debt, given that it will be 100% debt
financed. As a result of this new debt and the acquired operations
of TBS, we expect Natura to post debt to EBITDA close to 3.5x in
2017 (pro forma for the acquisition) and around 3.0x in 2018,
compared with around 1.7x in 2016. The higher debt will also
weaken the interest coverage ratios, with EBITDA interest coverage
close to 3.5x in 2017 and 2.5x in 2018, compared with 4.2x in
2016. We expect the closing of the transaction in the next two
months, pending the approval from the anti-trust agency of the
U.S., where there's limited overlapping of Natura and TBS
operations.

"We understand that Natura will face challenges to stabilize TBS
operations, which have been posting declining profitability over
the past few years. This could heighten volatility to the
consolidated results and limit Natura's ability to generate
stronger free operating cash flow to deleverage. On the other
hand, Natura and TBS show a strong alignment in terms of strategic
positioning, and the combined business will broaden Natura's
geographic diversification and increase its exposure to the retail
segment. TBS currently operates about 3,000 stores with total
revenue of about EUR900 million and reported EBITDA margin of
around 8%.

"We believe that Natura's management will put in place a solid
turnaround plan for TBS's operations, by closing several
underperforming stores, refitting others, and gradually expanding
in growing markets and channels. As a result, we expect the
company's profitability to recover in the next two years. Also, we
believe that Natura can unlock synergies with TBS, although we
still don't factor them in our forecast, mainly in distribution
channels and logistics. Natura's expertise in direct sales model
could foster TBS's sales and brand awareness in Brazil, while
TBS's strong retail presence in target countries for Natura and
Aesop could also accelerate the expansion pace into other markets.

"We maintain our view of a mild recovery in Natura's Brazilian
operations in 2017 due to fierce competition and still weak
market, resulting in consumers' shift towards less expensive
brands and lower consumption. The company has recently reshaped
its direct-sale model, which should help volumes and margins
rebound mainly starting in 2018. On the other hand, Natura's
international operations should continue posting consistent growth
and improving margins. Following the consolidation of TBS's fiscal
results, we expect international operations to represent about 55%
of consolidated revenue and 40% of reported EBITDA for the next
two years."



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


DOMINICAN REPUBLIC: No New Taxes, Control on Imports to Resell
--------------------------------------------------------------
Dominican Today reports that Dominican Republic Customs Director
Enrique Ramirez said the agency hasn't levied new taxes on
companies that use couriers, and instead control those who import
articles to resell.

"There are no new taxes, we are simply putting order in
cooperation with the courier companies," the official said at the
2nd Annual Conference of the Authorized Economic Operator Program
(OAS-DR), according to Dominican Today.

The report notes that Mr. Ramirez said the measure affects only
retailers, while those who bring articles for personal use pay no
taxes when their value is below US$200.  Mr. Ramirez said failing
to enact controls would unfairly allow the entry for commercial
purposes, the report relays.

Mr. Ramirez said Customs is checking to regulate those who have
several accounts in courier companies, to prevent the import of
goods tax free, the report notes.

Mr. Ramirez added that the measure isn't new since it's being
conducted for months, the report adds.

As reported in Troubled Company Reporter-Latin America on July 24,
2017, Moody's Investors Service has upgraded the Dominican
Republic's long term issuer and debt ratings to Ba3 from B1 and
changed the outlook to stable from positive, based on the
following key drivers:

(1) The Dominican Republic's continued robust growth outlook
     compared to rating peers, coupled with a reduction in
     external risks as current account deficits have declined and
     international reserves have increased.

(2) The reduction in fiscal deficits over the last four years and
     Moody's expectation that fiscal deficits will remain shy of
     3% of GDP, supported by fiscal restraint and reduced
     transfers to the electricity sector


DOMINICAN REPUBLIC: July Prices Climb 0.18%, Paced by Foods
------------------------------------------------------------
Dominican Today reports that Dominican Republic's Central Bank
said July prices climbed 0.18% compared to June, while accumulated
inflation in the first seven months stood at 1.20%.

"The report reveals that core annual inflation was 2.23% in the
month of July.  (This indicator measures inflationary pressures of
monetary origin, isolating the effects of exogenous factors,
allowing in this way to extract clearer signals for the conduct of
monetary policy)," the Central Bank said in an emailed statement,
according to Dominican Today.

It adds that consumer prices were most influenced by the Food and
Non-Alcoholic Beverages group, which rose 0.50% in July compared
to June, the report notes.

As reported in Troubled Company Reporter-Latin America on July 24,
2017, Moody's Investors Service has upgraded the Dominican
Republic's long term issuer and debt ratings to Ba3 from B1 and
changed the outlook to stable from positive, based on the
following key drivers:

(1) The Dominican Republic's continued robust growth outlook
     compared to rating peers, coupled with a reduction in
     external risks as current account deficits have declined and
     international reserves have increased.

(2) The reduction in fiscal deficits over the last four years and
     Moody's expectation that fiscal deficits will remain shy of
     3% of GDP, supported by fiscal restraint and reduced
     transfers to the electricity sector


DOMINICAN REPUBLIC: Regulates Web-Bought Imported Goods for Resale
------------------------------------------------------------------
Dominican Today reports that the Dominican Republic Customs Agency
is drafting a regulation on imported goods via the Web for
commercial purposes through courier companies.

According to Dominican Today, the draft published on the Custom
Agency's website as part of a public consultation states that
companies of persons who through courier companies import goods
classified within category "B" (valued below US$200 and without
tariff restriction) defined in Executive Order 402-05, will be
considered suppliers and, consequently, will be obliged to pay
duties and taxes of their imports, in the following cases:

   (A) When importing goods that, as a whole, don't exceed
       US$200, but which may be determined by Customs to have a
       commercial purpose.

   (B) When the type of merchandise imported, as well as the time
       from shipment and another one allows Customs to determine
       that they have a commercial purpose.

   (C) When the presence of identical, similar, complementary or
       substitute goods is detected in a procedure or a set of
       procedures, which in their totality exceed the amount of
       US$200, imported through a consignee.

   (D) When the imported merchandise has a noticeable relationship
       with the commercial activity of the company or person,
       whose consignment appears in the shipping documents.

   (E) When the company or person incurs any type of
       fractionation.

Merchandise included

The goods listed in Executive order 402-05 in category "B" are:
materials for mass distribution in commercial quantities, such as
some types of literature, printed documents, newspapers and
magazines enveloped or labeled at source. Also duty-free and tax-
exempt low-value consignments, among others.

As reported in Troubled Company Reporter-Latin America on July 24,
2017, Moody's Investors Service has upgraded the Dominican
Republic's long term issuer and debt ratings to Ba3 from B1 and
changed the outlook to stable from positive, based on the
following key drivers:

(1) The Dominican Republic's continued robust growth outlook
     compared to rating peers, coupled with a reduction in
     external risks as current account deficits have declined and
     international reserves have increased.

(2) The reduction in fiscal deficits over the last four years and
     Moody's expectation that fiscal deficits will remain shy of
     3% of GDP, supported by fiscal restraint and reduced
     transfers to the electricity sector



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


PUERTO RICO: Gibson Dunn Files Challenge to Oversight Board
-----------------------------------------------------------
Gibson Dunn on Aug. 7, 2017, filed a constitutional challenge to
the Puerto Rico oversight board, suggesting the Board is acting
without transparency, accountability, or oversight, which could
impact all of those different kinds of holders of PR debt.

On behalf of funds managed by Aurelius Capital ("Aurelius"),
Gibson Dunn filed the objection and motion to dismiss the
Commonwealth's Title III proceeding on the ground that the
appointments of the members of the Puerto Rico Oversight Board
violate the Appointments Clause of the United States Constitution.

Theodore B. Olson will serve as Aurelius's lead counsel in this
matter.  He will be assisted by his partners Matthew D. McGill and
Helgi Walker.  Mr. McGill previously represented creditors of
Puerto Rico before the Supreme Court in their successful challenge
to Puerto Rico's "Recovery Act," which attempted to set up a
bankruptcy regime for Puerto Rico under Puerto Rican law.
Ms. Walker leads, along with Mr. Olson, a pending and historic
separation of powers challenge to the Consumer Financial
Protection Board, in which they prevailed before a panel of the
D.C. Circuit.

Aurelius also has filed a motion for relief from the automatic
stay imposed by PROMESA so that Aurelius may seek in district
court declaratory and injunctive relief that would prohibit the
Board from operating until it is reconstituted in compliance with
the Appointments Clause.

The following quote may be attributed to Theodore B. Olson of
Gibson, Dunn & Crutcher LLP:

"The members of the Oversight Board were appointed in blatant
violation of the Appointments Clause of the Constitution.  This
constitutional problem with the Board has been obvious ever since
the legislation creating it was debated in Congress, with at least
one Senator openly warning of the defect -- so this suit comes as
no surprise.  Whether or not one agrees with the policy positions
of the Board, foundational legal principles require that it be
constituted in compliance with the Constitution."

A copy of the Objection and Motion of Aurelius to Dismiss Title
III Petition is available for free at:

    http://bankrupt.com/misc/ObjectionandMotiontoDismiss.pdf

A copy of the Motion of Aurelius for Relief from Automatic Stay is
available for free at:

           http://bankrupt.com/misc/LiftStayMotion.pdf

                      About Puerto Rico

Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70
billion, a 68% debt-to-GDP ratio and negative economic growth in
nine of the last 10 years.

The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.

The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III
of 2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ("PROMESA").

The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21.  On July 2, 2017, a Title III case was commenced for the
Puerto Rico Electric Power Authority ("PREPA").

U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases.  The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that
may be referred to her by Judge Swain, including discovery
disputes, and management of other pretrial proceedings.

Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.

The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets as municipal investment
banker, and Ernst & Young, as financial advisor.

Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at
O'Neill & Borges are onboard as attorneys.

McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets
Inc. is the Board's municipal investment banker.

Prime Clerk LLC is the claims and noticing agent.  Prime Clerk
maintains a case web site at:

           https://cases.primeclerk.com/puertorico

Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.

O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.

The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.

                      Bondholders' Attorneys

Toro, Colon, Mullet, Rivera & Sifre, P.S.C. and Kramer Levin
Naftalis & Frankel LLP serve as counsel to the Mutual Fund Group,
comprised of mutual funds managed by Oppenheimer Funds, Inc.,
Franklin Advisers, Inc., and the First Puerto Rico Family of
Funds, which collectively hold over $3.5 billion in COFINA Bonds
and over $2.9 billion in other bonds issued by Puerto Rico and
other instrumentalities, including over $1.8 billion of Puerto
Rico general obligation bonds ("GO Bonds").

White & Case LLP and Lopez Sanchez & Pirillo LLC represent the UBS
Family of Funds and the Puerto Rico Family of Funds, which hold
$613.3 million in COFINA bonds.

Paul, Weiss, Rifkind, Wharton & Garrison LLP, Robbins, Russell,
Englert, Orseck, Untereiner & Sauber LLP, and Jimenez, Graffam &
Lausell are co-counsel to the ad hoc group of General Obligation
Bondholders, comprised of Aurelius Capital Management, LP,
Autonomy Capital (Jersey) LP, FCO Advisors LP, Franklin Mutual
Advisers LLC, Monarch Alternative Capital LP, Senator Investment
Group LP, and Stone Lion Capital Partners L.P.

Quinn Emanuel Urquhart & Sullivan, LLP and Reichard & Escalera are
co-counsel to the ad hoc coalition of holders of senior bonds
issued by COFINA, comprised of at least 30 institutional holders,
including Canyon Capital Advisors LLC and Varde Investment
Partners, L.P.

Correa Acevedo & Abesada Law Offices, P.S.C., is counsel to Canyon
Capital Advisors, LLC, River Canyon Fund Management, LLC, Davidson
Kempner Capital Management LP, OZ Management, LP, and OZ
Management II LP (the QTCB Noteholder Group).

                            Committees

The U.S. Trustee formed a nine-member Official Committee of
Retirees and a seven-member Official Committee of Unsecured
Creditors of the Commonwealth.  The Retiree Committee tapped
Jenner & Block LLP and Bennazar, Garcia & Milian, C.S.P., as its
attorneys.   The Creditors Committee tapped Paul Hastings  LLP and
O'Neill & Gilmore LLC as counsel.


PUERTO RICO: Oversight Board Moves to Implement Fiscal Plan
-----------------------------------------------------------
During its ninth Open Meeting held Aug. 4, 2017, in Fajardo, the
Financial Oversight and Management Board for Puerto Rico, created
by Congress under the bipartisan Puerto Rico Oversight, Management
and Economic Stability Act ("PROMESA" or the "Act"), focused on
implementation of the certified Fiscal Plan, specifically two
elements critical to the success of achieving fiscal
responsibility: implementation of pension reform and government
right-sizing. It also certified a compliant fiscal plan, subject
to certain amendments, for the Public Corporation for the
Supervision and Insurance of Cooperatives (COSSEC).

Pension Reform

During the meeting, the Board reported on the work it has been
doing with respect to pension reform in accordance with the
Commonwealth's certified Fiscal Plan.  Pension reform is one of
the critical reforms necessary for the stabilization and
revitalization of the economy of Puerto Rico.

"The employee retirement systems will soon deplete the assets they
use to pay benefits.  Without action, this could lead to large
benefit cuts for all retirees that would be devastating,"
said Oversight Board member and pension system expert Andrew
Biggs, as he led a discussion of the proposed reforms.

Biggs noted that the Board's proposals for system-wide overhaul of
the government's pension system are meant to accomplish three
things: First, fund existing pension obligations on a "pay go"
basis, which means that the government will pay benefits to
retirees directly as they come due. Second, enroll both active
employees and newly-hired workers in a true defined contribution
retirement system. Third, ensure that all newly-hired employees
are enrolled in Social Security.

It was also noted that the Commonwealth's certified Fiscal Plan
provides for a reduction in pension benefit outlays of 10% by
fiscal year 2020, to ensure the systems can meet their
obligations to all retirees.  These pension benefit reductions
would be enacted in a progressive manner, with protections to
ensure that those at or below the poverty level are not impacted
by pension adjustments.  To ensure the necessary savings are
achieved and to provide retirement security to current and future
retirees, reforms will be pursued through a court approved plan of
adjustment.

The Oversight Board released an explanatory memorandum that
details the proposed changes to Puerto Rico's government pension
systems as provided for in the certified Fiscal Plan for Puerto
Rico.

Right-sizing

During the meeting, the Oversight Board reviewed the importance of
government right-sizing efforts to the certified Fiscal Plan.
Right-sizing in the certified Fiscal Plan targeted savings of $880
million in Fiscal Year 2018.  The Government made marked progress
by submitting $662 million in right-sizing measures toward this
target. Therefore, the Board determined that additional measures
must result in net savings of at least the remaining $218 million.
Accordingly, the Oversight Board determined to reduce but not to
repeal the furlough program included in the Commonwealth's
certified Fiscal Plan.  The Government must plan for and execute a
furlough program, commencing on Sept. 1, 2017, which shall be
formally communicated to the Governor.  Additionally, the fiscal
year 2018 budget should be adjusted to reflect these changes.

"In light of the significant progress that the Government has made
on right-sizing, we foresee this will be a two-day per month
furlough for all Executive Branch employees, with the exclusion
only of front-line police, for fiscal year 2018.  This is instead
of the furlough program that the certified Fiscal Plan envisioned,
which was a four-day per month furlough for most government
employees," said Oversight Board Executive Director Natalie
Jaresko.

"We recognize that the Government has made significant progress in
enacting meaningful measures to right-size the government and
government spending, in an effort to bring spending in line with
Puerto Rico's dire fiscal reality and to encourage a greater share
of private sector development and employment.  However, full
implementation is required to enable us to reach the goals in the
certified Fiscal Plan, which envisions an overall 30% reduction in
the Government's operating expenditures over three years," said
Jaresko.

In addition to $441 million in subsidy reductions, specific
savings the Board credited towards the $880 million right-sizing
target include $188 million in payroll-related measures and $33
million in additional non-personnel expenditure reductions,
Jaresko explained.

As per the Fiscal Plan, the furlough program will remain active
until two criteria are met: (1) the required savings of $218
million have been achieved or are reasonably expected to be
achieved based on actual fiscal year-to-date and projected fiscal
year performance; and (2) the Board determines in its sole
discretion that the Government has made material and sufficient
progress toward identifying opportunities, developing plans,
and beginning to execute the transformational changes required to
truly right-size the Government.

Regarding the Government's recent announcement that it intends to
implement an Incentivized Transition Program, which could produce
significant long-term savings, the Board recognized it is a
promising step in the right direction, but noted it will not be
able to produce any budgetary savings in fiscal year 2018.

Certification of COSSEC'S Fiscal Plan with Amendments

At the meeting, the Oversight Board unanimously adopted a
resolution approving the certification of a compliant fiscal plan,
subject to certain amendments, for the Public Corporation for the
Supervision and Insurance of Cooperatives ("COSSEC") pursuant to
PROMESA Sec. 201(e).  The Board resolved that COSSEC's Fiscal Plan
should be amended (1) to include revised stress-test analyses that
replicate the National Credit Union Administration's approach; (2)
to include an implementation plan for the COOP-SELF program; (3)
to include a reform plan that redefines COSSEC'S mission and
governance; and (4) to outline the scope of activities that
should be addressed through requests for external assistance from
federal agencies or external contractors.

Furthermore, the certification of COSSEC's Fiscal Plan remained
contingent on three additional conditions requiring amendments to
existing statutes: (1) amending the COSSEC Enabling Act to provide
that during the implementation of the fiscal plan, the Government
constitute a committee composed of COSSEC's Board President, the
Executive Director of the Puerto Rico Fiscal Agency and Financial
Advisory Authority ("AAFAF," for its Spanish acronym) and the
Commissioner of Financial Institutions that will supersede
COSSEC's Board and its powers; (2) amending both the Coops Act and
COSSEC's Enabling Act to authorize a coop to issue preferred
shares in an amount in excess of the amount of its common stock
and to expressly authorize COSSEC to sell the assets of a coop to
a non-coop entity in the event that COSSEC orders the liquidation,
consolidation or merger of such coop; and (3) amending Act 220-
2015 in order that COSSEC's regulatory powers over a cooperative
are not limited in any way due to a coop's investments in bonds or
notes issued by the Commonwealth or its instrumentalities.

The Board specifically requested the Government to submit within
30 days, a plan to implement the amendments and a revised fiscal
plan that complies with the measures described in said amendments
no later than 15 days thereafter.

Conclusion

"We have entered an important new stage in the implementation of
PROMESA.  We have moved from developing a Fiscal Plan and Budget
within that plan, to implementation of the certified Fiscal Plan.
Key elements of the plan include right-sizing the government and
government spending, pension reform, healthcare reform and tax
reform.  Today, we moved forward in two of these areas, both
critical to achieving fiscal discipline in Puerto Rico," concluded
Jaresko.

The recorded proceedings, as well as all material of public
interest considered during the meeting, will be posted on the
Oversight Board's website as soon as possible after the meeting

Contact:

         Jose Luis Cedeno
         Tel: 787-400-9245
         E-mail: jcedeno@forculuspr.com
                 info@forculuspr.com

Board's Contact Information:

         E-mail: comments@oversightboard.pr.gov
         Web site: www.oversightboard.pr.gov

                       About Puerto Rico

Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70
billion, a 68% debt-to-GDP ratio and negative economic growth in
nine of the last 10 years.

The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.

The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III
of 2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ("PROMESA").

The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21.  On July 2, 2017, a Title III case was commenced for the
Puerto Rico Electric Power Authority ("PREPA").

U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases.  The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that
may be referred to her by Judge Swain, including discovery
disputes, and management of other pretrial proceedings.

Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.

The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets as municipal investment
banker, and Ernst & Young, as financial advisor.

Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at
O'Neill & Borges are onboard as attorneys.

McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets
Inc. is the Board's municipal investment banker.

Prime Clerk LLC is the claims and noticing agent.  Prime Clerk
maintains a case web site at:

           https://cases.primeclerk.com/puertorico

Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.

O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.

The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.

                      Bondholders' Attorneys

Toro, Colon, Mullet, Rivera & Sifre, P.S.C. and Kramer Levin
Naftalis & Frankel LLP serve as counsel to the Mutual Fund Group,
comprised of mutual funds managed by Oppenheimer Funds, Inc.,
Franklin Advisers, Inc., and the First Puerto Rico Family of
Funds, which collectively hold over $3.5 billion in COFINA Bonds
and over $2.9 billion in other bonds issued by Puerto Rico and
other instrumentalities, including over $1.8 billion of Puerto
Rico general obligation bonds ("GO Bonds").

White & Case LLP and Lopez Sanchez & Pirillo LLC represent the UBS
Family of Funds and the Puerto Rico Family of Funds, which hold
$613.3 million in COFINA bonds.

Paul, Weiss, Rifkind, Wharton & Garrison LLP, Robbins, Russell,
Englert, Orseck, Untereiner & Sauber LLP, and Jimenez, Graffam &
Lausell are co-counsel to the ad hoc group of General Obligation
Bondholders, comprised of Aurelius Capital Management, LP,
Autonomy Capital (Jersey) LP, FCO Advisors LP, Franklin Mutual
Advisers LLC, Monarch Alternative Capital LP, Senator Investment
Group LP, and Stone Lion Capital Partners L.P.

Quinn Emanuel Urquhart & Sullivan, LLP and Reichard & Escalera are
co-counsel to the ad hoc coalition of holders of senior bonds
issued by COFINA, comprised of at least 30 institutional holders,
including Canyon Capital Advisors LLC and Varde Investment
Partners, L.P.

Correa Acevedo & Abesada Law Offices, P.S.C., is counsel to Canyon
Capital Advisors, LLC, River Canyon Fund Management, LLC, Davidson
Kempner Capital Management LP, OZ Management, LP, and OZ
Management II LP (the QTCB Noteholder Group).

                            Committees

The U.S. Trustee formed a nine-member Official Committee of
Retirees and a seven-member Official Committee of Unsecured
Creditors of the Commonwealth.  The Retiree Committee tapped
Jenner & Block LLP and Bennazar, Garcia & Milian, C.S.P., as its
attorneys.   The Creditors Committee tapped Paul Hastings  LLP and
O'Neill & Gilmore LLC as counsel.


PUERTO RICO: Committee Tasked to Conduct Debt Probe Appointed
-------------------------------------------------------------
On Aug. 2, 2017, the Financial Oversight and Management Board for
Puerto Rico, created by Congress under the bipartisan Puerto Rico
Oversight, Management and Economic Stability Act ("PROMESA" or the
"Act"), announced its intention to conduct a comprehensive
investigation of Puerto Rico's debt and its relationship to the
fiscal crisis and to form a special committee of the Oversight
Board to carry out such investigation, including through the
appointment by the special committee of an independent
investigator.

Pursuant to Section 104(o) of the Puerto Rico Oversight,
Management, and Economic Stability Act ("PROMESA"), 48 U.S.C. Sec.
2124(o), the Oversight Board has authority to "investigate the
disclosure and selling practices in connection with the purchase
of bonds issued by a covered territory for or on behalf of any
retail investors including any underrepresentation of risk for
such investors and any relationships or conflicts of interest
maintained by such broker, dealer, or investment adviser . . . as
provided in applicable laws and regulations."

Pursuant to Section 3.9 of the Oversight Board's Bylaws, the
Oversight Board may designate one or more standing or special
committees to consist of one or more members of the Oversight
Board and to expressly authorize any such committee to take any
official action on behalf of the Board.

Accordingly, the Oversight Board designates a special committee
(the "Special Investigation Committee") to pursue investigations
pursuant to the Oversight Board's authority under PROMESA Section
104(o), 48 U.S.C. Sec. 2124(o), or such other authority invested
in the Board to conduct investigations under PROMESA, including
PROMESA Sections 104(a), (c) and (f), 48 U.S.C. Sec. 2124(a), (c)
and (f); provided further that in conducting any investigation,
the Special Investigation Committee will be entitled, as it (in
its sole discretion) deems appropriate, to pursue such
investigations pursuant to the Oversight Board Procedures.

The Oversight Board delegates to the Special Investigation
Committee any and all authority of the Oversight Board to pursue
investigations pursuant to the Oversight Board's authority under
PROMESA Section 104(o), 48 U.S.C. Sec. 2124(o), or such other
authority invested in the Board to conduct investigations under
PROMESA, including PROMESA Sections 104(a), (c) and (f), 48 U.S.C.
Sec. 2124(a), (c), and to make public its findings pursuant to
PROMESA Section 104(p) ), 48 U.S.C. Sec. 2124(p).

The Oversight Board appoints to the Special Investigation
Committee Board members Jose B. Carrion, Arthur J. Gonzalez, Ana
J. Matosantos and David A. Skeel, Jr.

                       About Puerto Rico

Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70
billion, a 68% debt-to-GDP ratio and negative economic growth in
nine of the last 10 years.

The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.

The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III
of 2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ("PROMESA").

The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21.  On July 2, 2017, a Title III case was commenced for the
Puerto Rico Electric Power Authority ("PREPA").

U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases.  The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that
may be referred to her by Judge Swain, including discovery
disputes, and management of other pretrial proceedings.

Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.

The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets as municipal investment
banker, and Ernst & Young, as financial advisor.

Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at
O'Neill & Borges are onboard as attorneys.

McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets
Inc. is the Board's municipal investment banker.

Prime Clerk LLC is the claims and noticing agent.  Prime Clerk
maintains a case web site at:

           https://cases.primeclerk.com/puertorico

Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.

O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.

The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.

                      Bondholders' Attorneys

Toro, Colon, Mullet, Rivera & Sifre, P.S.C. and Kramer Levin
Naftalis & Frankel LLP serve as counsel to the Mutual Fund Group,
comprised of mutual funds managed by Oppenheimer Funds, Inc.,
Franklin Advisers, Inc., and the First Puerto Rico Family of
Funds,
which collectively hold over $3.5 billion in COFINA Bonds and over
$2.9 billion in other bonds issued by Puerto Rico and other
instrumentalities, including over $1.8 billion of Puerto Rico
general obligation bonds ("GO Bonds").

White & Case LLP and Lopez Sanchez & Pirillo LLC represent the UBS
Family of Funds and the Puerto Rico Family of Funds, which hold
$613.3 million in COFINA bonds.

Paul, Weiss, Rifkind, Wharton & Garrison LLP, Robbins, Russell,
Englert, Orseck, Untereiner & Sauber LLP, and Jimenez, Graffam &
Lausell are co-counsel to the ad hoc group of General Obligation
Bondholders, comprised of Aurelius Capital Management, LP,
Autonomy Capital (Jersey) LP, FCO Advisors LP, Franklin Mutual
Advisers LLC, Monarch Alternative Capital LP, Senator Investment
Group LP, and Stone Lion Capital Partners L.P.

Quinn Emanuel Urquhart & Sullivan, LLP and Reichard & Escalera are
co-counsel to the ad hoc coalition of holders of senior bonds
issued by COFINA, comprised of at least 30 institutional holders,
including Canyon Capital Advisors LLC and Varde Investment
Partners, L.P.

Correa Acevedo & Abesada Law Offices, P.S.C., is counsel to Canyon
Capital Advisors, LLC, River Canyon Fund Management, LLC, Davidson
Kempner Capital Management LP, OZ Management, LP, and OZ
Management II LP (the QTCB Noteholder Group).

                            Committees

The U.S. Trustee formed a nine-member Official Committee of
Retirees and a seven-member Official Committee of Unsecured
Creditors of the Commonwealth.  The Retiree Committee tapped
Jenner & Block LLP and Bennazar, Garcia & Milian, C.S.P., as its
attorneys.   The Creditors Committee tapped Paul Hastings  LLP and
O'Neill & Gilmore LLC as counsel.



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


CITGO PETROLEUM: US Sanctions on Venezuela Won't Affect Operations
------------------------------------------------------------------
Any US sanctions that prohibit Venezuela from selling oil to the
US would hurt Citgo Petroleum (B3 stable) and Citgo Holding (Caa1
stable), but it is unlikely that they would have the effect of
disrupting the companies' operations, Moody's Investors Service
says in a new report.

The US recently imposed sanctions on several Venezuelans,
including President Nicolas Maduro, over their handling of the
crisis, and has threatened with economic sanctions, which could
block the state-owned oil company Petroleos de Venezuela, S.A.
(Caa3 negative) from selling its oil to the US. Lack of access to
PDVSA's oil would increase costs of crude and negatively affect
its 100% subsidiary Citgo's margins and credit metrics.

"While Citgo depends on Venezuela for about 28% of its crude
supply, it buys heavily from other markets, and could re-balance
its crude mix to an optimal profit level, although in several
months. Meanwhile, fuel prices in the US could increase as well,
helping offset the negative effect of higher crude costs, says
Nymia Almeida, a VP- Senior Credit Officer at Moody's.

Even though the company is indirectly exposed to international
outcry stemming from the escalating political turmoil in Venezuela
Moody's believes that, if Citgo's access to PDVSA's oil were
interrupted, it would not have to materially increase capital
spending to adjust its refineries to a different mix of crudes,
but its profitability would suffer.


VENEZUELA: Regional Governments Reject New Assembly
---------------------------------------------------
Ryan Dube at The Wall Street Journal reports that governments from
across Latin America agreed not to recognize Venezuela's powerful
new constituent assembly, saying that it represented a breakdown
in the country's democratic order.

"What we have in Venezuela is a dictatorship," Peru's Foreign
Relations Minister Ricardo Luna said while surrounded by his
counterparts from Latin America's biggest countries, including
Brazil, Mexico, Chile and Colombia, according to The Wall Street
Journal.  "This is a regional crisis, without precedent," he
added.

In a declaration, foreign ministers and other top officials from
12 countries, including Canada, said the decisions by Venezuela's
545-member constituent assembly will be considered illegitimate,
the report notes.

The assembly was installed after an election widely considered
fraudulent amid concerns that it will be used by embattled
President Nicolqs Maduro to wipe out dissent as it rewrites the
constitution, the report relays.  It passed a decree saying that
its decisions will override those of all other government
branches, the report notes.  The assembly agreed to convene for
the next two years, which the opposition fears will result in the
suspension of the 2018 presidential election, the report says.

The Venezuelan government didn't return a request for comment.
Mr. Maduro says the constituent assembly will bring peace to
Venezuela, blaming the country's political and economic crisis on
the opposition and foreign powers, the report relays.  In the
past, he has called Latin American leaders critical of his
administration pawns of the United States, the report says.

Mr. Maduro met allies from leftist Latin American nations,
accusing his critics in the region of wanting to interfere in
Venezuelan sovereignty, the report notes.  "How much blackmail,
brothers and sisters," Mr. Maduro said.  "The continental right
has torn up the rules of the game for coexistence," he added.

The assembly, which is made up Mr. Maduro's allies, including his
wife and son, has already moved quickly to crack down on critics.
During its first session, it voted to remove from office dissident
Attorney General Luisa Ortega, a onetime ally of Mr. Maduro who
broke with the government over her opposition to the assembly, the
report relays.  Ms. Ortega, who was barred from entering the
attorney general's office by soldiers in riot gear, has said she
won't recognize the decision, the report notes.  She has said she
would continue with her investigations into corruption and human-
rights abuses by the government, the report relays.

The Latin American officials meeting in Peru said they supported
Ms. Ortega and will continue to recognize the opposition-
controlled Congress, the report discloses.  Mr. Maduro and his
allies have threatened to close the Congress and strip lawmakers
of immunity from prosecution, saying some could be thrown in jail,
the report notes.

The declaration condemned the use of violence, the government's
persecution of critics and detention of hundreds of political
prisoners, the report says.  The Latin American nations also urged
other countries to halt the sale of weapons to Venezuela, and said
it would not support any Venezuelan candidate put forward by the
government for positions at international and regional
organizations, the report notes.

The meeting in Lima follows Venezuela's suspension from South
America's Mercosur trade bloc for failing to follow democratic
norms and the U.S. decision to hit the increasingly-isolated Mr.
Maduro with sanctions, calling him a dictator, the report adds.

It also came two days after an attack on a key army base in
Venezuela's third city of Valencia by former army officers and
civilians, highlighting discontent with the government among
lower-ranking military officials, the report notes.  That has
raised concerns of increased violence after months of
antigovernment protests that have left over 120 people dead, the
report relays.

Chilean Foreign Relations Minister Heraldo Munoz said his
government will push for a peaceful solution to the crisis in
Venezuela, which is struggling with the world's highest inflation
and shortages of food and medicine, the report discloses.  He said
the officials in Lima will likely meet again during the U.N.'s
general assembly in September, the report says.

"We still have time to avoid a deepening of the Venezuelan
crisis," Mr. Mu§oz said, the report adds.

As reported on Troubled Company Reporter-Latin America on July 13,
2017, S&P Global Ratings lowered its long-term foreign and local
currency sovereign credit ratings on the Bolivarian Republic of
Venezuela to 'CCC-' from 'CCC'. The outlook on the long-term
ratings is negative. S&P said, "We affirmed our 'C' short-term
foreign and local currency sovereign ratings. In addition, we
lowered our transfer and convertibility assessment on the
sovereign to 'CCC-' from 'CCC'."


                            ***********


Monday's edition of the TCR-LA delivers a list of indicative
prices for bond issues that reportedly trade well below par.
Prices are obtained by TCR-LA editors from a variety of outside
sources during the prior week we think are reliable.   Those
sources may not, however, be complete or accurate.  The Monday
Bond Pricing table is compiled on the Friday prior to publication.
Prices reported are not intended to reflect actual trades.  Prices
for actual trades are probably different.  Our objective is to
share information, not make markets in publicly traded securities.
Nothing in the TCR-LA constitutes an offer or solicitation to buy
or sell any security of any kind.  It is likely that some entity
affiliated with a TCR-LA editor holds some position in the
issuers' public debt and equity securities about which we report.

Tuesday's edition of the TCR-LA features a list of companies with
insolvent balance sheets obtained by our editors based on the
latest balance sheets publicly available a day prior to
publication.  At first glance, this list may look like the
definitive compilation of stocks that are ideal to sell short.
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

Submissions about insolvency-related conferences are encouraged.
Send announcements to conferences@bankrupt.com


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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., Washington, D.C.,
USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A.
Chapman, Editors.

Copyright 2017.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Latin America subscription rate is US$775 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each.  For subscription information,
contact Peter A. Chapman at 215-945-7000 or Joseph Cardillo at
856-381-8268.


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