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       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

          Friday, July 26, 2019, Vol. 20, No. 149

                           Headlines



A R G E N T I N A

CHACO PROVINCE: Fitch Affirms 'B' LT IDRs, Outlook Negative
PROVINCE OF ENTRE RIOS: S&P Affirms 'B' LT ICR, Outlook Stable


B R A Z I L

BRAZIL: IMF Says Sluggish Recovery is Underway
CENTROVIAS SISTEMAS: Moody's Withdraws Ba2 CFR for Business Reasons
INTERCEMENT BRASIL: S&P Lowers Debt Rating to 'B'
JBS SA: Discloses Cash Tender Offers and Consent Solicitation


D O M I N I C A N   R E P U B L I C

DOMINICAN REPUBLIC: Milk Producers Demand US$0.6/L from Dairy Cos.
DOMINICAN REPUBLIC: Trade With UK Topped US$107MM in First 4 Mos.


M E X I C O

GRUPO CEMENTOS: S&P Affirms 'BB+' ICR, Outlook Stable


P A N A M A

[*] PANAMA: IMF Says Economic Recovery Has Been Slower


P U E R T O   R I C O

PUERTO RICO: Governor Resigns


V E N E Z U E L A

PETROLEOS DE VENEZUELA: To Halt Production of Synthetic Crude
VENEZUELA: Maduro Says U.S. Triggered Massive Blackout

                           - - - - -


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A R G E N T I N A
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CHACO PROVINCE: Fitch Affirms 'B' LT IDRs, Outlook Negative
-----------------------------------------------------------
Fitch Ratings has affirmed the Province of Chaco's Long-Term
Foreign- and Local-Currency Issuer Default Ratings at 'B'/Negative
Outlook, reflecting the Negative Outlook assigned to Argentina.
Fitch has also affirmed the 'B' long-term ratings on Chaco's 9.375%
senior unsecured notes for USD250 million.

KEY RATING DRIVERS

The rating actions are based on Fitch's new "Rating Criteria for
International Local and Regional Governments" (LRGs) published on
April 9, 2019. Under these criteria, the key rating drivers for
Argentinean LRGs are their risk profile and debt sustainability
ratios. Fitch classifies Chaco as a type B LRG since the entity
must cover debt service from cash flow on an annual basis.

Fitch has assigned Chaco a Standalone Credit Profile (SCP) of 'b',
which reflects a combination of 'Vulnerable' risk profile
assessment and 'weak' debt metrics, which resulted in a 'bb' debt
sustainability assessment. The SCP also factors in rated peers'
positioning. Fitch does not apply any asymmetric risk or
extraordinary support from upper-tier governments. As a result,
Chaco's IDR is derived from its SCP assessment "b", which is in
line with Argentina's IDR.

DERIVATION SUMMARY

Risk Profile Assessment: Vulnerable

There are six weaker assessments for the risk factors, which in
combination with sovereign rating of 'B' resulted in a 'Vulnerable'
risk profile assessment for Chaco.

Revenue Robustness: Weaker

Chaco's revenue source is volatile, as more than 80% of operating
revenue are transfers from the national government (B/Negative)
through federal co-participation tax transfers and other current
transfers. Federal Shared Tax Revenue is comprised of federal taxes
that are linked to national economic activity, currently under
recession. Chaco is located in the north-eastern region of
Argentina with improving socioeconomic indicators.

Revenue Adjustability: Weaker

Fitch believes that revenue adjustability is weak for Chaco
considering that the province presents low tax autonomy coupled
with a below average GDP per capita. Moreover, tax revenues are
expected to grow lower than inflation in 2019. Affordability of
additional taxation in the country is perceived as low as tax rates
are high and distortive. With an estimated population of around 1.1
million (less than 3% of Argentina's) GDP per capita is around
USD3,553, much below the national average of USD11,522.

Expenditure Sustainability: Weaker

Chaco's expenditure flexibility is low, as it has significant
responsibilities, such as the provision of health care and
education. Salary and price adjustments have pressured operating
expenditure in recent years. Additionally, Chaco's track record of
fiscal prudence is limited, hampered by the fact that expenditure
growth is influenced by inflation dynamics.

Expenditure Adjustability: Weaker

There are expenditure budget balance rules in place but no strong
track record of application. As with other provinces, there is a
lack of structural reforms at the national and provincial level,
which makes long-term fiscal sustainability questionable. Given the
high inflationary environment and some pressures to update
salaries, Fitch expects expenditures growth to outpace revenues
growth in 2019.

Liabilities and Liquidity Robustness: Weaker

There is weak national framework for debt and liquidity. The
country has weak accountability and disclosure practices for
off-balance sheet risks, including public sector entities. Also,
there is moderate appetite for risk, although policies have been
prudent. Regarding debt maturity, Fitch expects some increases in
2022 when the USD250 million bond starts amortizing. Chaco's
pension scheme deficit has been partially funded (around 40% of
annual obligations) by the national government since 2017.

Liabilities and Liquidity Flexibility: Weaker

There is no, or very limited emergency liquidity support from upper
tiers (sovereign counterparty below BBB-). Chaco can cover
temporary deficits of the provincial treasury through the use of
the fund balances of the entire province's non-financial public
sector without financial cost (FUCO, the Spanish acronym for this
mechanism). In 2018, FUCO usage reached ARS5.1 billion,
corresponding to low 8.3% of Chaco's operating revenues.

Debt Sustainability

Chaco has weak debt metrics; direct debt of ARS 24.3 billion in
2018 represented 4.7x of the operating balance. As of 2018, 60.4%
of the provincial debt was denominated in foreign currency with no
protection also considering the fact that the province does not
have any revenues linked directly to the USD.

Debt sustainability assessed at 'bb'. Fitch's rating case
forward-looking scenario indicates net direct risk corresponding to
levels close to 18x of operating balance by 2021 and a debt service
coverage ratio less than 1x.

KEY ASSUMPTIONS

Fitch's rating case scenario is a "through-the-cycle" scenario,
which incorporates a combination of revenue, cost and financial
risk stresses. It is based on the 2018 estimated figures and
2019-2021 projected ratios.

Fitch's rating case scenario for Chaco assumes operating revenues
in line with inflation. Salaries and pensions are expected to
increase slightly lower than inflation in 2019 with a one off
benefit in operating margins.

RATING SENSITIVITIES

Chaco's Issuer Default Ratings are in line with the sovereign;
therefore, a negative rating action affecting Argentina
(B/Negative) would result in a similar action for Chaco. Ratings
would be downgraded if Chaco misses any debt service payment. A
similar action would occur for Chaco's senior unsecured bond
ratings.

PROVINCE OF ENTRE RIOS: S&P Affirms 'B' LT ICR, Outlook Stable
--------------------------------------------------------------
On July 24, 2019, S&P Global Ratings affirmed its 'B' long-term
foreign and local currency issuer credit ratings on the Argentine
province of Entre Rios. The outlook remains stable. At the same
time, S&P affirmed its 'B' issue-level ratings on the province's
senior unsecured debt.

Outlook

S&P said, "The stable outlook reflects our expectation that over
the next 12-18 months, Entre Rios will continue to pursue
disciplined fiscal policies that should lessen the impact of the
recent economic recession and Argentina's gradually recovering
economy on the province's revenues. In our opinion, the recently
reelected administration will continue the fiscal consolidation
program started in 2017, with prudent management of the wage bill
and subdued capex. These factors should result in small operating
margins and moderate deficits after capex. Lower financing needs
and uncertain capital market conditions should limit the province's
borrowing in the next year and gradually reduce the debt burden,
although it will continue to be highly vulnerable to exchange rate
volatility, like most entities in Argentina."

Downside scenario

S&P said, "We could lower our ratings on Entre Rios in the next 12
months if we were to lower the sovereign ratings, given the diverse
and strong links connecting the entities. We could also lower the
ratings if the province's finances unexpectedly worsen. This could
occur if the administration is unable to rein in spending or if
Argentina's economy worsens over the next couple of years, reducing
the province's revenues. In this scenario, we would expect the
province's debt to increase or growing liquidity pressures."

Upside scenario

S&P said, "Given that we don't believe that Argentine local and
regional governments meet the conditions for us to rate them above
the sovereign, we could only upgrade Entre Rios if we take a
similar action on Argentina within the next 12 months and we see
continuous improvements in the province's stand-alone credit
profile (SACP). In particular, we would expect to see
faster-than-expected fiscal consolidation, with operating surpluses
near 5%, or a surplus after capex, allowing for better long-term
fiscal planning."

Rationale

The 'B' ratings on Entre Rios are at the same level as its SACP and
reflect a weak economic risk profile given Argentina's economic
instability, currently characterized by economic recession, high
inflation, exchange rate volatility, and high real interest rates.
Despite the unfavorable economic context, Entre Rios'
administration has managed revenues and expenses positively over
the last two years and improved its fiscal performance. Along with
the province's adequate fiscal management, additional transfers
from the sovereign and the gradual erosion of real expenditures
facilitated by high inflation also boosted fiscal performance. S&P
expects the province will continue to pursue prudent fiscal, debt,
and liquidity management policies that will keep reducing the
province's debt burden over the next few months.

Prudent policies should counterbalance difficult economic
conditions.

The national government's fiscal and monetary tightening is
weighting on the national and provincial economy this year. S&P
expects the provincial economy to shrink 1.6% in 2019 (in line with
its expectation for Argentina), after contracting 2.5% in 2018.
Entre Rios' GDP per capita will be about $9,577 this year, down
from nearly $12,200 in 2015-2017, reflecting not only the recession
but also the exchange rate depreciation. Similar to other Argentine
provinces, Entre Rios has a record of poor growth, partly because
of a history of economic instability and sharp changes in economic
policies in Argentina. While its performance in 2020 and onwards
will depend to a large extent on the results of the presidential
election this October, S&P expects a long period of economic
tightening in Argentina as long as inflation remains high.

S&P said, "In our view, the institutional framework for Argentine
local and regional governments (LRGs) remains characterized by very
weak institutional predictability, a volatile intergovernmental
system, and fiscal imbalances. However, we note that this framework
has improved during the Macri administration, allowing Argentine
provinces to maintain a better revenue and expenditure balance."
National policies have helped provinces throughout the country,
including provinces governed by the political opposition to the
federal government, such as Entre Rios. Since 2016, automatic
transfers that the provinces receive have increased following
various agreements between the central government and the
provinces. Thanks to these funds and measures to rein in spending
stemming from the new Fiscal Responsibility Law, most LRGs have
stronger fiscal positions than in the recent past.

Gustavo Eduardo Bordet (Peronist Party) was reelected governor in
the June 2019 provincial election for a second four-year term.
After a challenging first year of his administration in 2016 (when
high inflation and the economic downturn resulted in a high
operating deficit), fiscal consolidation has been a priority of his
cabinet. S&P said, "The administration's cost control measures have
gradually reduced the fiscal gap and improved the province's debt
and liquidity management, and we expect these policies to continue
over the next few months. However, we believe that the financial
planning remains a key opportunity for the province, because
management has been focused on correcting its short-term
imbalances, delaying the discussion of longer-term issues such as
the sustainability of the province's pension system."

S&P expects the province's debt stock to decrease as financing
needs will be limited.

S&P believes Entre Rios will keep reducing its fiscal gap in the
next couple of years, despite stagnant revenues amid the only
gradually recovering economy. In S&P's base case, it expects
moderate operating surpluses of 2.5% of operating revenues on
average in 2019-2021. Although Argentine provinces continue to
benefit from the steady transfer of 15% of co-participation funds
from the national government, transfers the province received grew
below inflation in the first months of 2019 because of the economic
downturn. The province also continues to gradually reduce the gross
receipt taxes as agreed to in the fiscal pact. Given the province's
limited room to increase revenues, the management's commitment to
continue implementing tight cost control measures will be key to
maintain the recent progress in the province's fiscal performance,
especially in the context of very high inflation and a rigid budget
structure. Payroll represents 45% of Entre Rios' operating
spending, while pension-related costs represent 7.8%.

The province's efforts to rein in spending have focused mainly on
the wage bill. The number of public servants has been gradually
decreasing since 2016, when the province implemented a hiring
freeze. Last year, Entre Rios also benefited from
higher-than-expected inflation, which allowed for a real wage
reduction. Austerity measures also included a significant cut in
capital spending to 5% of total spending last year from about 12%
in 2014. In the coming months, S&P expects public works to remain
subdued because financing conditions remain unfavorable for
Argentina.

For the next two years, Entre Rios' financing needs will be limited
given the administration's commitment to fiscal consolidation.
Therefore, we expect debt stock to decline to 26% of operating
revenues by 2021, from 33% in 2018. Nevertheless, its debt profile
will be exposed to sharp adverse movements in the exchange rate,
because almost 80% of the debt stock is dollar-denominated. S&P
expects Entre Rios' borrowing in upcoming years to be mainly
composed of multilateral lending institutions and funding from the
National Social Security Agency fund (FGS-ANSES).

Entre Rios' improved fiscal results strengthened liquidity last
year, and we estimate the available free cash currently covers 84%
of projected debt service payments for the next 12 months,
estimated at ARS6 billion. S&P said, "In our view, the province's
liquidity practices have also improved. Until 2017, Entre Rios
resorted to short-term notes to finance its liquidity needs and
cancelled them at the beginning of 2018. We don't expect that it
will use them again in the next few months, following the
administration's commitment to reduce the debt burden.
Additionally, the province lowered its use of advanced
co-participation funds at the beginning of this year. However, we
still consider that access to external liquidity assessment is
limited, given our view of Argentina's weak banking system and the
province's limited track record of issuances in the capital
markets."

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the methodology
applicable. At the onset of the committee, the chair confirmed that
the information provided to the Rating Committee by the primary
analyst had been distributed in a timely manner and was sufficient
for Committee members to make an informed decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.

The committee's assessment of the key rating factors is reflected
in the Ratings Score Snapshot above.

The chair ensured every voting member was given the opportunity to
articulate his/her opinion. The chair or designee reviewed the
draft report to ensure consistency with the Committee decision. The
views and the decision of the rating committee are summarized in
the above rationale and outlook. The weighting of all rating
factors is described in the methodology used in this rating
action.

  Ratings List

  Ratings Affirmed
  Entre Rios (Province of)

  Issuer Credit Rating B/Stable/--
  Senior Unsecured B




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B R A Z I L
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BRAZIL: IMF Says Sluggish Recovery is Underway
----------------------------------------------
On July 15, 2019 the Executive Board of the International Monetary
Fund (IMF) concluded the Article IV consultation with Brazil.

A sluggish recovery is underway, constrained by subdued aggregate
demand and lackluster productivity. After contracting by almost 7
percent during the 2015-16 recession, real GDP grew by 1.1 percent
per year in 2017 and 2018. Short-term economic indicators show
weakness in the first half of 2019. Investment remains subdued,
given large spare capacity and uncertainty over prospects for
fiscal and structural reforms. Weak global growth and the recession
in Argentina are holding back exports and contributed to a widening
of the current account deficit to 0.8 percent of GDP last year. The
fiscal stance was broadly neutral in 2018, with a slight
improvement in the nonfinancial public sector primary balance to
-1.7 percent of GDP. The central bank has held the policy rate at
the historic low of 6.5 percent since March 2018, providing the
economy with some monetary stimulus. Headline inflation is around
the 4.25 percent inflation target for 2019, while core inflation is
more muted. Improvement in social conditions has stalled in recent
years, in part due to elevated unemployment rates.

Growth is projected at 0.8 percent in 2019 and to accelerate in
2020 conditional on the approval of a robust pension reform and
favorable financial conditions. The current budget is guided by the
federal expenditure ceiling, entailing a minor reduction of the
structural primary balance in 2019. Compliance with the ceiling in
the following years will depend on approval of the pension reform
and other consolidation measures. The current account deficit is
foreseen to deteriorate to 1.5 percent of GDP in 2019 mostly on
account of one-off operations related to the energy sector and the
recession in Argentina. Nonetheless, Brazil's external position
remains strong thanks to a large amount of reserves, a flexible
exchange rate, and a contained current account deficit fully
financed by large FDI inflows. The financial system is well
capitalized. Intermediation margins in the banking sector remain
high, hindering credit demand and investment.

                  Executive Board Assessment

Executive Directors agreed with the thrust of the staff appraisal.
They concurred that the pace of the economic recovery has been
sluggish and is subject to downside risks stemming from uncertainty
on fiscal consolidation and structural reforms.

Directors underscored that fiscal consolidation and bold reforms
are needed to address Brazil's legacies of low growth and high
public debt. They concurred that pension reform is imperative to
ensure fiscal sustainability and improve equity, and welcomed
recent progress in this area. Furthermore, to put public finances
on a sustainable path, Directors considered that additional
measures are required, including containing the public wage bill,
reducing other current expenditure, and addressing budget
rigidities. Simplifying the overly complicated and distortive tax
system will support growth. Directors also emphasized the need to
protect public investment and effective social programs, including
Bolsa Familia.

Directors agreed that the current monetary policy stance should
remain accommodative in the context of a still large output gap and
anchored inflation expectations. They noted that in the future
there may be scope to loosen monetary policy further in case fiscal
consolidation proves contractionary and inflation expectations
remain anchored.

Directors noted that the flexible exchange rate and large reserves
remain important to absorb shocks and underscored that intervention
in the foreign exchange market should be limited to addressing
disorderly conditions. They welcomed the recent bill on the
relationship between the Treasury and the Central Bank, which
enhances the institutional framework, and underscored the
importance of formalizing central bank independence.

Directors agreed that the financial system is broadly resilient but
firms and households face an unduly high cost of borrowing. They
welcomed progress on strengthening the financial sector and agreed
that further steps should be taken to enhance oversight of banks in
line with the 2018 FSAP recommendations, particularly the
implementation of a new financial resolution regime. Directors also
agreed on the importance of improving the efficiency of financial
intermediation and welcomed the recent approval of the credit
registry law.

Directors encouraged the authorities to step up implementation of
structural reforms essential to raise potential growth, including
improving the business environment, lowering trade barriers, and
boosting productivity. In this respect, they welcomed the recent
trade agreement between Mercosur and the EU, which, once ratified,
will be key to open up the economy. Reform efforts should also
focus on continuing to reduce state intervention in credit markets
and improving public infrastructure. Directors underscored that the
ongoing efforts to combat corruption and the effective
implementation of anti-money laundering remain critically
important.

It is expected that the next Article IV consultation with Brazil
will be held on the standard 12-month cycle.

As reported in the Troubled Company Reporter-Latin America on May
27, 2019, Fitch Ratings has affirmed Brazil's Long-Term
Foreign-Currency Issuer Default Rating (IDR) at 'BB-' with a Stable
Outlook.

CENTROVIAS SISTEMAS: Moody's Withdraws Ba2 CFR for Business Reasons
-------------------------------------------------------------------
Moody's America Latina Ltda. has withdrawn the Ba2 global scale and
Aa2.br national scale Corporate Family Ratings assigned to
Centrovias Sistemas Rodoviarios S.A.. Prior to the withdrawal, the
outlook was stable.

  - The following ratings were withdrawn:

Issuer: Centrovias Sistemas Rodoviarios S.A.

  - Corporate Family Ratings: Ba2 (Global Scale Rating), Aa2.br
(National Scale Rating)

  - Outlook, changed to rating withdrawn from stable

RATINGS RATIONALE

Moody's has decided to withdraw the ratings for its own business
reasons.

The last rating action on Centrovias Sistemas Rodoviarios S.A. was
taken on January 23, 2018 when Moody's upgraded the company's
ratings to Ba2/Aa2.br from Ba3/A1.br (respectively, in global scale
and Brazil's national scale) and changed the outlook to stable from
positive.

Centrovias is the company responsible for operating the toll road
system encompassing the state toll roads, SP-310 (Sao Carlos to
Cordeiropolis) and SP-225 (Itapirina to Jau, and Jau to Bauru),
pursuant to a 20-year concession agreement granted by the State of
Sao Paulo in 1998.The company's road operations cover 218
kilometers and encompass five toll plazas. The concession is
currently set to expire in August 2019. As of March 2019 the
company held no financial debt.

INTERCEMENT BRASIL: S&P Lowers Debt Rating to 'B'
--------------------------------------------------
On July 24, 2019, S&P Global Ratings downgraded the Brazil-based
cement producer InterCement Brasil S.A. to 'B' from 'B+' on global
scale and to 'brA' from 'brAA' on national scale. S&P also lowered
its debt rating to 'B' from 'B+'.

The downgrade reflects InterCement's likely lower earnings and
EBITDA for the next 12 months due to higher risks to the company's
competitive advantages. After the disposal of the Portuguese and
Cape Verde operations last year, InterCement's footprint has shrunk
and remains concentrated in Brazil and Argentina, where operating
conditions are subpar.

The cement market in Brazil is recovering at a sluggish pace in
2019. S&P expects InterCement to sell close to 8 million tons of
cement in 2019, compared with 12.5 million in 2014 and 2015. Lack
of market confidence and significant infrastructure projects are
the main factors are behind the market slowdown. In 2020,
conditions may slightly improve for long-term investment decisions
depending on how the market perceives mid-term risks.

The Argentine subsidiary, Loma Negra, currently generates 55% of
total cash flows. Despite volatile economic conditions, with
currency swings and high inflation pressuring costs, Loma Negra's
solid market position and the government's ambitious infrastructure
plan allowed the subsidiary to maintain profitable operating
margins. InterCement's main project, L'Amali II, would increase
operating efficiency at the Argentine division starting in 2020,
but political risks may erode the subsidiary's capacity to generate
hard currency in the future, if economic problems exacerbate under
the next administration.

After several changes at Mover subsidiaries' portfolio, InterCement
now accounts for 80%-90% of the group's EBITDA. Apart from
InterCement's financial obligations, the group also guarantees
Estaleiro Atlantico Sul's (EAS) debt (about R$660 million) and is
ultimately responsible for the fine stemming from the leniency
agreement fine determined at the E&C subsidiary level (about R$800
million). After the sale of its share at CPFL Energia S.A., Mover
repaid almost all of its corporate debt and has currently about
R$1.8 billion in cash. Mover is also has a 15% minority interest in
CCR S.A., with current market value of about R$4.5 billion.

In December 2018, Mover decided to inject about R$300 million into
InterCement. The latter returned the proceeds to Mover after the
sale of the Portuguese assets.

JBS SA: Discloses Cash Tender Offers and Consent Solicitation
-------------------------------------------------------------
JBS S.A. said that its wholly-owned subsidiary, JBS Investments
GmbH ("JBS Investments"), has commenced cash tender offers (each, a
"Tender Offer" and collectively, the "Tender Offers") for (i) any
and all of its outstanding U.S.$750,000,000 aggregate principal
amount of 7.250% Senior Notes due 2024 (the "2024 Notes") and (ii)
up to U.S.$350,000,000 (the "Maximum Tender Amount") of its
outstanding U.S.$775,000,000 aggregate principal amount of 6.250%
Senior Notes due 2023 (the "2023 Notes" and together with the 2024
Notes, the "Notes").

In conjunction with the 2024 Notes Tender Offer, JBS Investments is
also soliciting consents (the "2024 Notes Consent Solicitation")
from the holders of the 2024 Notes for the adoption of proposed
amendments (the "Proposed Amendments"), which would, among other
things, (i) eliminate substantially all of the restrictive
covenants and certain events of default and related provisions
contained in the indenture governing the 2024 Notes and (ii) reduce
the minimum required notice period for the redemption of 2024 Notes
from 30 days to three days prior to the date fixed for redemption
(maintaining the maximum notice period of 60 days).

The Tender Offers and the 2024 Notes Consent Solicitation are being
made pursuant to an Offer to Purchase and Consent Solicitation
Statement, dated July 23, 2019 (as may be amended or supplemented
from time to time, the "Offer to Purchase").

Holders who tender 2024 Notes must also consent to the Proposed
Amendments to the indenture governing the 2024 Notes. Holders of
2024 Notes may not deliver consents to the Proposed Amendments
without validly tendering the 2024 Notes in the 2024 Notes Tender
Offer and may not revoke their consents without withdrawing the
previously tendered 2024 Notes to which they relate. The Proposed
Amendments will be set forth in a supplemental indenture relating
to the 2024 Notes and are described in more detail in the Offer to
Purchase. Adoption of the Proposed Amendments requires the delivery
of consents by holders of 2024 Notes of a majority of the aggregate
outstanding principal amount of 2024 Notes (not including any 2024
Notes which are owned by JBS or any of its affiliates).

The deadline for holders to validly tender Notes and deliver
consents and be eligible to receive payment of the Total
Consideration (as defined below), which includes the Early Tender
Payment (as defined below), will be 5:00 p.m., New York City time,
on August 5, 2019, unless extended or earlier terminated by JBS
Investments (such date and time, as the same may be modified, the
"Early Tender Payment Deadline"). The Tender Offers will expire at
11:59 PM, New York City time, on August 19, 2019, unless extended
or earlier terminated by JBS Investments (such date and time, as
the same may be modified, the "Expiration Time"). 2024 Notes
tendered may be withdrawn and consents for the Proposed Amendments
delivered may be revoked at any time prior to the execution of the
supplemental indenture (the date and time of such execution and
delivery, the "2024 Notes Withdrawal Deadline"), but not
thereafter, unless required by applicable law. 2023 Notes tendered
may be withdrawn at any time prior to the Early Tender Payment
Deadline (the "2023 Notes Withdrawal Deadline" and together with
the 2024 Notes Withdrawal Deadline, the "Withdrawal Deadline"), but
not thereafter, unless required by applicable law.

The total consideration payable to 2024 Notes Holders for each
U.S.$1,000 principal amount of 2024 Notes validly tendered and
purchased pursuant to the 2024 Notes Tender Offer will be
U.S.$1,039.75 (the "2024 Notes Total Consideration"). The 2024
Notes Total Consideration includes an early tender payment of
U.S.$30.00 per U.S.$1,000 principal amount of 2024 Notes (the "2024
Notes Early Tender Payment") payable only to 2024 Notes Holders who
validly tender (and do not withdraw) their 2024 Notes and validly
deliver (and do not revoke) the related 2024 Notes consents at or
prior to the Early Tender Payment Deadline. 2024 Notes Holders who
validly tender (and do not withdraw) their 2024 Notes after the
Early Tender Payment Deadline but at or prior to the Expiration
Time will be eligible to receive U.S.$1,009.75 per U.S.$1,000
principal amount of 2024 Notes (the "2024 Notes Tender Offer
Consideration"), which amount will be equal to the 2024 Notes Total
Consideration less the 2024 Notes Early Tender Payment. In
addition, JBS Investments will pay accrued and unpaid interest on
the principal amount of 2024 Notes accepted for purchase from the
most recent interest payment date on the 2024 Notes to, but not
including, the applicable settlement date for such 2024 Notes (the
"2024 Notes Accrued Interest"). Payment in cash of an amount equal
to the 2024 Notes Total Consideration, plus 2024 Notes Accrued
Interest, for such accepted 2024 Notes will be made on the 2024
Notes early settlement date, which is expected to be within three
business days after the Early Tender Payment Deadline, or as
promptly as practicable thereafter.

The total consideration payable to 2023 Notes Holders for each
U.S.$1,000 principal amount of 2023 Notes validly tendered and
purchased pursuant to the 2023 Notes Tender Offer will be
U.S.$1,022.08 (the "2023 Notes Total Consideration", and together
with the 2024 Notes Total Consideration, the "Total
Consideration"). The 2023 Notes Total Consideration includes an
early tender payment of U.S.$30.00 per U.S.$1,000 principal amount
of 2023 Notes (the "2023 Notes Early Tender Payment", and together
with the 2024 Notes Early Tender Payment, the "Early Tender
Payment") payable only to 2023 Notes Holders who validly tender
(and do not withdraw) their 2023 Notes at or prior to the Early
Tender Payment Deadline. 2023 Notes Holders who validly tender (and
do not withdraw) their 2023 Notes after the Early Tender Payment
Deadline but at or prior to the Expiration Time will be eligible to
receive U.S.$992.08 per U.S.$1,000 principal amount of 2023 Notes
(the "2023 Notes Tender Offer Consideration", and together with the
2024 Notes Tender Offer Consideration, the "Tender Offer
Consideration"), which amount will be equal to the 2023 Notes Total
Consideration less the 2023 Notes Early Tender Payment. In
addition, JBS Investments will pay accrued and unpaid interest on
the principal amount of 2023 Notes accepted for purchase from the
most recent interest payment date on the 2023 Notes to, but not
including, the applicable settlement date for such 2023 Notes (the
"2023 Notes Accrued Interest", and together with the 2024 Notes
Accrued Interest, the "Accrued Interest"). Payment in cash of an
amount equal to the 2023 Notes Total Consideration, plus 2023 Notes
Accrued Interest, for such accepted 2023 Notes will be made on the
2023 Notes early settlement date, which is expected to be within
three business days after the Early Tender Payment Deadline, or as
promptly as practicable thereafter. If 2023 Notes are validly
tendered in an aggregate principal amount in excess of the Maximum
Tender Amount pursuant to the 2023 Notes Tender Offer, such
tendered 2023 Notes will be subject to proration (as described in
the Offer to Purchase).

JBS Investments' obligation to accept for purchase, and to pay for,
Notes validly tendered and not validly withdrawn pursuant to the
Tender Offers is conditioned upon the satisfaction or, when
applicable, waiver of certain conditions, which are more fully
described in the Offer to Purchase, including, among others, a
financing condition as described in the Offer to Purchase. In
addition, subject to applicable law, JBS Investments reserves the
right, in its sole discretion, to (i) extend, terminate or withdraw
the Tender Offers or the 2024 Notes Consent Solicitation at any
time or (ii) otherwise amend the Tender Offers or the 2024 Notes
Consent Solicitation in any respect at any time and from time to
time. JBS Investments further reserves the right, in its sole
discretion, not to accept any tenders of Notes or deliveries of
consents with respect to the 2024 Notes. JBS Investments is making
the Tender Offers and the 2024 Notes Consent Solicitation only in
those jurisdictions where it is legal to do so.

Barclays Capital Inc. is acting as dealer manager for the Tender
Offers and as solicitation agent for the 2024 Notes Consent
Solicitation and can be contacted at their telephone numbers set
forth on the back cover page of Offer to Purchase with questions
regarding the Tender Offers and the 2024 Notes Consent
Solicitation.

Copies of the Offer to Purchase are available to holders of Notes
from D.F. King & Co., Inc., the information agent and the tender
agent for the Tender Offers and the 2024 Notes Consent
Solicitation. Requests for copies of the Offer to Purchase should
be directed to D.F. King at +1 (877) 536-1556 (toll free), +1 (212)
269-5550 (collect) or jbs@dfking.com.

Neither the Offer to Purchase nor any related documents have been
filed with the U.S. Securities and Exchange Commission, nor have
any such documents been filed with or reviewed by any federal or
state securities commission or regulatory authority of any country.
No authority has passed upon the accuracy or adequacy of the Offer
to Purchase or any related documents, and it is unlawful and may be
a criminal offense to make any representation to the contrary.

The Tender Offers and the 2024 Notes Consent Solicitation are being
made solely on the terms and conditions set forth in the Offer to
Purchase. Under no circumstances shall this press release
constitute an offer to buy or the solicitation of an offer to sell
the Notes or any other securities of JBS or any of its
subsidiaries, including JBS Investments. The Tender Offers and the
2024 Notes Consent Solicitation are not being made to, nor will JBS
accept tenders of Notes or accept deliveries of 2024 Notes Consents
from, holders in any jurisdiction in which the Tender Offers and
the 2024 Notes Consent Solicitation or the acceptance thereof would
not be in compliance with the securities of blue sky laws of such
jurisdiction. This press release also is not a solicitation of
consents to the Proposed Amendments to the indenture governing the
2024 Notes. No recommendation is made as to whether holders should
tender their Notes or deliver their consents with respect to the
2024 Notes. Holders should carefully read the Offer to Purchase
because it contains important information, including the various
terms and conditions of the Tender Offers and the 2024 Notes
Consent Solicitation.

As reported in the Troubled Company Reporter-Latin America on June
19, 2019, Fitch Ratings has upgraded JBS S.A.'s Long-Term Foreign-
and Local Currency Issuer Default Ratings and senior unsecured
notes issued by JBS Investments GmbH and JBS Investments II GmbH
to 'BB' from 'BB-'. The National Scale rating was upgraded to 'AA+
(bra)' from 'A(bra)'. The Rating Outlook is Stable. The upgrade
reflects JBS expected deleveraging and strong free cash flow
generation and improved financial flexibility due to recent
liability management.



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

DOMINICAN REPUBLIC: Milk Producers Demand US$0.6/L from Dairy Cos.
------------------------------------------------------------------
Dominican Today reports that hundreds of milk producers converged
on the Agriculture Ministry in a motorcade to demand higher milk
prices from dairy companies.

Milk Producers Association (Aproleche) President Eric Rivero, said
that for more than seven years the price per liter of milk on the
farm has remained between 21 and 23 pesos despite that it has been
raised to consumers several times, according to Dominican Today
reports that.

He said farmers have been working without any kind of profit for
several years since their production costs exceed RD$23 per liter
of milk, the report notes.  "That's why we demand that
industrialists pay $30 pesos (US$0.6) per liter of milk," he
added.

                  About Dominican Republic

The Dominican Republic is a Caribbean nation that shares the island
of Hispaniola with Haiti to the west. Capital city Santo Domingo
has Spanish landmarks like the Gothic Catedral Primada de America
dating back 5 centuries in its Zona Colonial district.

The Troubled Company Reporter-Latin America reported on April 4,
2019 that the Dominican Today related that Juan Del Rosario of the
UASD Economic Faculty cited a current economic slowdown for the
Dominican Republic and cautioned that if the trend continues,
growth would reach only 4% by 2023. Mr. Del Rosario said that if
that happens, "we'll face difficulties in meeting international
commitments."

An ongoing concern in the Dominican Republic is the inability of
participants in the electricity sector to establish financial
viability for the system.

Standard & Poor's credit rating for Dominican Republic stands at
BB- with stable outlook (2015). Moody's credit rating for Dominican
Republic was last set at Ba3 with stable outlook (2017). Fitch's
credit rating for Dominican Republic was last reported at BB- with
stable outlook (2016).

DOMINICAN REPUBLIC: Trade With UK Topped US$107MM in First 4 Mos.
-----------------------------------------------------------------
Dominican Today reports that in the first four months of 2019,
trade between the Dominican Republic and the United Kingdom topped
US$107 million, of which US$35.8 million correspond to the
country's exports to the UK, while US$71.5 million were imports.

The figures are from bulletin #5 on trade relations between the
United Kingdom and the Dominican Republic "Brexit: Beginnings,
Chronology and Current Situation," which includes the January-April
2019 period, according to Dominican Today.

"When describing and analyzing the behavior of the main trends of
bilateral trade between the United Kingdom and the Dominican
Republic, it is stated that in general terms, total trade increased
by 34.86% compared to the same period of 2018," El Nuevo Diario
reported, Dominican Today relays.


                  About Dominican Republic

The Dominican Republic is a Caribbean nation that shares the island
of Hispaniola with Haiti to the west. Capital city Santo Domingo
has Spanish landmarks like the Gothic Catedral Primada de America
dating back 5 centuries in its Zona Colonial district.

The Troubled Company Reporter-Latin America reported on April 4,
2019 that the Dominican Today related that Juan Del Rosario of the
UASD Economic Faculty cited a current economic slowdown for the
Dominican Republic and cautioned that if the trend continues,
growth would reach only 4% by 2023. Mr. Del Rosario said that if
that happens, "we'll face difficulties in meeting international
commitments."

An ongoing concern in the Dominican Republic is the inability of
participants in the electricity sector to establish financial
viability for the system.

Standard & Poor's credit rating for Dominican Republic stands at
BB- with stable outlook (2015). Moody's credit rating for Dominican
Republic was last set at Ba3 with stable outlook (2017). Fitch's
credit rating for Dominican Republic was last reported at BB- with
stable outlook (2016).



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

GRUPO CEMENTOS: S&P Affirms 'BB+' ICR, Outlook Stable
-----------------------------------------------------
S&P Global Ratings affirmed its 'BB+' issuer credit and issue-level
ratings on Mexico-based cement producer Grupo Cementos de Chihuahua
S.A.B. de C.V. (GCC). The recovery rating on the senior unsecured
notes remains unchanged at '3'.

S&P said, "The stable outlook reflects our view that GCC will
recover from operational setbacks at the beginning of the year due
to adverse weather conditions in the U.S., which undermined its
top-line growth and profitability. Moreover, we expect the company
to maintain its EBITDA margin at about 30% and to sustain its
prudent financial policy, prioritizing its cash flow generation,
reflected in adjusted debt to EBITDA around 1.5x in the next 12
months."

The ratings affirmation reflects GCC's solid operating and
financial performance, as it continues to deleverage its balance
sheet. The company's operating performance improved in the second
quarter of 2019 from disappointing results in the first quarter,
with EBITDA margin increasing to 29.5% from 23.8%, reflecting
greater volumes as cement demand recovered in states affected by
weather conditions. For the last 12 months ended June 2019, GCC
posted adjusted debt to EBITDA close to 2.0x, in line with our
previous expectations. S&P expects GCC to post a stronger second
half of the year with greater EBITDA and cash flow generation,
ending the year with adjusted debt to EBITDA around 1.5x.



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

[*] PANAMA: IMF Says Economic Recovery Has Been Slower
------------------------------------------------------
A staff team of the International Monetary Fund (IMF), led by
Alejandro Santos, visited Panama during July 17-23, 2019, invited
by the Panamanian authorities. At the end of the visit, Mr. Santos
issued the following statement:

"While Panama remains among the most dynamic economies in Latin
America, the economic recovery has been slower than anticipated.
Real GDP grew at an annual rate of 3.1 percent in the first quarter
of 2019 (compared to 4 percent in the same period of last year),
due to a softening in construction and services. More recent data
point to a continuation of a sluggish recovery, leading us to
revise down our growth projection for 2019 to 5 percent (from 6
percent estimated in our February visit). Panama's fundamentals
remain solid, with the economy expected to recover and converge to
its potential growth of 5½ percent by next year, and inflation
edging up to 2 percent over the medium-term. The banking system
remains well-capitalized and liquid with low non-performing loans.
The external position will continue strengthening over the medium
term. The balance of risks to the outlook is tilted to the
downside, related to fears of rising trade protectionism, weaker
global outlook, and potential pressure on banks' correspondent
relations.

"Preliminary data indicate a decline in fiscal revenues and an
acceleration in the implementation of budgetary spending, leading
to a fiscal deficit in the first half of the year above the 2
percent of GDP limit established by the fiscal rule for the whole
year. In addition, sizable arrears accumulated to suppliers and
banks which need to be cleared. The authorities estimate that in
the absence of corrective measures, the fiscal deficit could reach
almost 4 percent of GDP in 2019. The authorities are committed to
corrective measures but fear that a rapid pace of implementation
could weaken the ongoing recovery further. Against that background,
the authorities expect to reduce the fiscal deficit by over 2
percent of GDP in the next two years, allowing them to observe the
deficit limit under the fiscal responsibility law of 1 3/4 percent
of GDP by 2021.

"In June 2019, the Financial Action Task Force (FATF) placed Panama
on the list of countries with strategic deficiencies on its
anti-money laundering framework. Despite recent progress on
financial integrity, including the recognition of tax evasion as a
predicate offense to money laundering, the legal framework needs to
be further strengthened and its effectiveness needs to be
demonstrated. The authorities are fully committed to implementing
the recommendations of the action plan agreed with the FATF and aim
to be out of this list as soon as it is possible. Sustained efforts
to enhance the anti-money laundering framework and tax transparency
will be crucial to strengthen Panama's position as a regional
financial center.

"Sustaining inclusive growth over the medium term will require
reinforcing the structural reform agenda, especially in education,
social security and public health services. Further improvements in
fiscal revenues and stricter expenditure controls will be required
to improve macroeconomic management, create the necessary fiscal
space to cover the cost of future reforms, and strengthen fiscal
discipline. We encourage the authorities to upgrade the statistical
framework to facilitate sound economic decision making at all
levels of government."



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

PUERTO RICO: Governor Resigns
-----------------------------
Nick Brown at Reuter reports that people danced in the streets of
San Juan's old city, after Puerto Rico Governor Ricardo Rossello
bowed to protesters' demands and said he would quit over profane
chat messages and a corruption scandal that have sparked massive
demonstrations.

The continuing celebrations were tempered by the fact that
protesters weren't enthused over Secretary of Justice Wanda Vazquez
being next in line to succeed Rossello, based on current cabinet
vacancies, according to Reuter.

The report notes that one protester waved a sign reading "Wanda, we
don't want you either" and another shouted "Wanda, you're next!"

After 12 days of sometimes violent demonstrations, first-term
governor Rossello said he would step down on Aug. 2, having failed
to soothe critics by vowing not to seek re-election and giving up
the leadership of his political party, the report relays.

"To continue in this position would make it difficult for the
success that I have achieved to endure," Rossello said in an
overnight address, listing accomplishments in office that ranged
from creating new industries to promoting equal pay for women, the
report notes.

Rossello's term as governor has seen the island hit with
back-to-back 2017 hurricanes that killed some 3,000 people and
wreaked widespread destruction, just months after the U.S.
territory filed for bankruptcy to restructure $120 billion of debt
and pension obligations, the report says.

The report relays that thousands of protesters in San Juan's
historic Old City erupted in joy when news broke that Rossello was
stepping down.

The report relays that Vazquez rejected charges of improper past
business ties leveled in Puerto Rican media.

"During our career in public service, we've showed that we've
worked in a righteous and honest manner to benefit the public,"
Vazquez told Puerto Rican media, the report notes.

After celebrating late into the night, hundreds of protesters
joined a morning rally in the city's financial district to mark the
governor's resignation and make clear their opposition to Vazquez,
the report discloses.

U.S. Representative Jenniffer Gonzalez, the island's nonvoting
delegate to Congress, said she welcomed Vazquez's elevation.

                    'People Are at Stake'

Multiple Democratic members of U.S. congress urged their colleagues
not to use the political turmoil as a reason to limit federal
funding for the disaster-rocked island or to block a plan to
increase federal Medicare funding for the island by $12 billion
over four years. the report notes.

"The people of Puerto Rico are at stake here, not any particular
individual that happens to be in the governor's seat right now,"
U.S. Representative Raul Grijalva, the Democratic chairman of the
National Resources Committee, said in a video posted online, the
report relays.

Weary of crisis and a decade-long recession, Puerto Ricans were
angered when U.S. authorities on July 10 accused two former
Rossello administration officials of pocketing federal money
through government contracts, the report discloses.

The final straw for many on the island came July 13 when Puerto
Rico's Center for Investigative Journalism published 889 pages of
chat messages between Rossello and 11 close allies, the report
notes.

In messages between November 2018 and January 2019 the group made
profane and sometimes violent statements about female political
opponents, gay singer Ricky Martin and ordinary Puerto Ricans, the
report relays.

The report notes that the chats tapped into simmering resentment
toward the island's political elites, drawing an estimated 500,000
people onto a San Juan highway to demand that Rossello quit as
governor of the island's 3.2 million people.

Rossello also faced the twin threats of an investigation by the
island's Department of Justice and political impeachment by its
legislature, the report relays.

Not all Puerto Ricans were delighted at Rossello's fall, notes the
report.

While Ricky Shub, 33, agreed that the former scientist in his first
elected office should step down, he said Rossello had become a
lightning rod for decades of pent-up anger, the report notes.

"He's taking the fall for a bunch of past governors that put us in
this position," said Shub, watching the celebrations in the old
city from his friend's roof deck, the report discloses.  "Everyone
here is right to do what they're doing, but they should have done
it 20 years ago," the report adds.

                        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, 2017.  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 on-board 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

Kramer Levin Naftalis & Frankel LLP and Toro, Colon, Mullet, Rivera
& Sifre, P.S.C. and serve as counsel to the Mutual Fund Group,
comprised of mutual funds managed by Oppenheimer Funds, Inc., and
the First Puerto Rico Family of Funds, which collectively hold over
$4.4 billion of GO Bonds, COFINA Bonds, and other bonds issued by
Puerto Rico and other instrumentalities.

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, and Monarch Alternative
Capital LP.

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 an official committee of retirees and an
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
=================

PETROLEOS DE VENEZUELA: To Halt Production of Synthetic Crude
-------------------------------------------------------------
Venezuela's state-owned oil company Petroleos de Venezuela, S.A.
(PDVSA) plans to indefinitely halt the production of upgraded
Orinoco Belt synthetic crudes in August, and instead is converting
its upgraders to blending facilities for the production of Merey 16
crude, according to an internal report reviewed by S&P Global
Platts.

However, as US sanctions have prevented imports of light crude and
heavy naphtha into Venezuela, PDVSA is bracing for another fall in
crude production and exports in August, according to the report,
according to S&P Global Platts.  PDVSA operates four upgraders in
the Orinoco: the 190,000 b/d Petropiar joint venture with Chevron;
the 120,000 b/d Petromonagas JV with Russia's Rosneft; the 202,000
b/d Petrocedeno JV with Total and Equinor; and the out-of-service
120,000 b/d Petro San Felix, the report notes.

According to PDVSA's August crude report, Petropiar is operating at
58% of capacity, Petromonagas at 50% and Petrocedeno at 46%.

Synthetic crudes produced at the upgraders, such as Special Hamaca
Blend and Zuata Sweet, were destined for refineries in the US
before sanctions were imposed in January and have since been sold
"under unfavorable market conditions" to Asia, the PDVSA report
said, the report notes.

The company noted it "has been forced to offer significant
discounts that have affected the value of such crudes and
complicated their placement since some customers have refused to
accept delivery of the sale," S&P Global Platts relays.

In January, the US unveiled sanctions on PDVSA which have served as
a de facto ban on US imports of Venezuelan crude and an immediate
ban on US exports of diluent to Venezuela, the report relays.  On
April 28, the US prohibited transactions between non-US firms and
PDVSA involving the US financial system, essentially banning the
use of US dollars in all transactions with PDVSA, the report
discloses.

In June, the US Treasury Department announced further prohibitions
on essentially all diluent trade with PDVSA, which PDVSA uses in
the production and marketing of its heavy crudes, S&P Global Platts
relays.

Three Orinoco upgraders have been converted to mixing facilities
for the exclusive purpose of producing Merey 16, the report notes.
However, the upgraders are expected to operate below capacity,
owing to the diminished availability of light crude and naphtha for
diluent, S&P Global Platts says.

According to PDVSA, the upgraders "have significant technical
operational weaknesses that are resulting in the production of
upgraded crudes outside the quality specifications demanded by new
markets, a situation that limits the possibility of marketing them,
as much for exportation or to domestic refineries," the report
notes.

The PDVSA report estimates Venezuela's crude production could fall
to 988,000 b/d in August from 1.2 million b/d at the start of June.
However, the PDVSA production estimates exceed reports by secondary
sources, and even other internal reports, as they most likely
include diluents being blended with Venezuela's heavy crude, S&P
Global Platts relays.

The latest Platts OPEC production survey shows Venezuela produced
760,000 b/d in June.

S&P Global Platts relates that PDVSA estimates that its August
crude exports will fall to 685,000 b/d from 776,000 b/d in June.
Exports will consist primarily of Merey 16, a mix of extra heavy
crude from the Orinoco Belt and diluent.

Because PDVSA is unable to obtain light crude and heavy naphtha for
diluent, however, the company will resort to using its increasingly
scarce output of Mesa 30 and Santa Barbara light crudes as a
blending diluent, S&P Global Platts notes.

Output of Mesa 30 is estimated at 202,000 b/d for August, and Santa
Barbara at 58,000 b/d, the report relays.  Both crudes are destined
for the production of Merey 16 in the upgrader plants converted to
blending facilities, the report notes.

"To regain PDVSA production at levels above 1 million b/d, PDVSA
must import every month 3.3 million barrels of light crudes of 44
API, such as Agbami, Akpo and Saharan Blend, which is impossible
under US sanctions," a company official told Platts under condition
of anonymity, the report discloses.

PDVSA also plans to extract naphtha used as a diluent to transport
heavy crude from the Morichal field crude to blend into Merey 16.
Morichal is operated by Sinovensa, a JV between PDVSA (60%) and
CNPC (40%), the report says.

In order to boost production, PDVSA will also need to stabilize
Orinoco output, which has fallen because of power outages.  Orinoco
production fell to just 124,000 b/d, down from 835,000 b/d in June,
according to a separate PDVSA report, the report relays.

"PDVSA has few options to continue maneuvering," the PDVSA official
said.  "In August, the availability of export crude will fall to
637,000 b/d of Merey 16 and Boscan crude, of which 320,000 b/d are
committed to repayment of debts and in exchange for refined
products, in addition to small quantities of Laguna and Bachaquero
crudes destined to the Nynas company in Europe," the report
relates

According to the August Crude Plan, PDVSA will be able to offer the
remaining 317,000 b/d to the international market, S&P Global
Platts notes.

According to previous reports, the Trump administration is strongly
considering letting a waiver which allows Chevron and four US oil
services companies to continue work with PDVSA to expire at the end
of the month, potentially accelerating the collapse of the
country's oil sector, S&P Global Platts discloses.

The waiver, a general license issued by the US Treasury Department
on January 28, allowed Chevron, Halliburton, Schlumberger, Baker
Hughes and Weatherford International to continue certain work with
PDVSA. The waiver expires on July 27, S&P Global Platts adds.

Petroleos de Venezuela, S.A. is the Venezuelan state-owned oil and
natural gas company. It has activities in exploration, production,
refining and exporting oil as well as exploration and production of
natural gas.

As reported in Troubled Company Reporter-Latin America on June 3,
2019, Moody's Investors Service withdrew all the ratings of
Petroleos de Venezuela, S.A. including the senior unsecured and
senior secured ratings due to insufficient information. At the time
of withdrawal, the ratings were C and the outlook was stable.

VENEZUELA: Maduro Says U.S. Triggered Massive Blackout
------------------------------------------------------
PBS News Hours reports that Venezuela's President Nicolas Maduro
blamed the United States for a second massive blackout this year
that cast most of the South American nation in darkness in a
desperate attempt to overthrow him.

The outage hit at rush hour leaving millions without basic services
freezing Caracas' metro, snarling traffic and leaving residents
without running water, according to PBS News Hours.

The report notes that Maduro said the U.S. launched a "high-tech
electromagnetic attack" to undermine his rule, but he gave no
details or evidence linking the power failure to the United
States.

"They have not been able, nor will they be able to with the unity,
loyalty and cohesion of the Venezuelan armed force, which is making
them desperate," the report quoted Mr. Maduro as saying.

He spoke on state TV surrounded by the high military command at the
Fuerte Tiuna military base in Caracas overseeing the start to
military exercises, the report relays.

The report discloses that Maduro's opponents blame the outages on
corruption and inadequate maintenance under two decades of
socialist rule first launched by the late President Hugo Chavez.

Venezuela is a once-wealthy oil nation that is caught in a historic
political and economic crisis that has sent at least four million
residents fleeing, driven by a lack of food and medicine, the
report says.

Electrical power returned to Caracas and several states hours after
the most recent failure. Maduro in March also blamed U.S. sabotage
for a nationwide blackout lasting nearly a week, considered the
nation's worst power failure in its history, the report notes.

Tensions between Venezuela and the United States intensified this
year when it was first among dozens of nations to announce its
support of Venezuelan opposition leader Juan Guaidom, the report
says.

Guaido in January declared Maduro's last election a fraud and cited
his role as leader of the National Assembly as giving him powers to
oust Maduro and hold new elections, the report discloses.  Guaido
then in April led a failed military uprising, the report relays.

Venezuelan officials also say the U.S. has twice sent a spy plane
into its airspace, the report notes.  In one case, a Venezuelan
fighter jet intercepted it, which U.S. officials say put the
plane's crew in danger and threatening its mission conducted while
flying in international airspace, the report adds.

                          About Venezuela

Venezuela, officially the Bolivarian Republic of Venezuela, is a
country on the northern coast of South America, consisting of a
continental landmass and a large number of small islands and
islets in the Caribbean sea.  The capital is the city of Caracas.

Hugo Chavez was president to Venezuela from 1999 to 2013.  The
Chavez presidency was plagued with challenges, which included a
2002 coup d'etat, a 2002 national strike and a 2004 recall
referendum.  Nicolas Maduro was elected president in 2013 after
the death of Chavez.  Maduro won a second term at the May 2018
Venezuela elections, but this result has been challenged by
countries including Argentina, Chile, Colombia, Brazil, Canada,
Germany, France and the United States who deemed it fraudulent and
moved to recognize Juan Guaido as president.

The presidencies of Chavez and Maduro have challenged Venezuela
with a socioeconomic and political crisis.  It is marked by
hyperinflation, climbing hunger, poverty, disease, crime and death
rates, social unrest, corruption and emigration from the country.

Standard and Poor's long- and short-term foreign currency
sovereign credit ratings for Venezuela stands at 'SD/D'
(November 2017).

S&P's local currency sovereign credit ratings on the other hand
are

'CCC-/C'. The May 2018 outlook on the long-term local currency
sovereign credit rating is negative, reflecting S&P's view that
the

sovereign could miss a payment on its outstanding local currency
debt obligations or advance a distressed debt exchange operation,
equivalent to default.

Moody's credit rating (long term foreign and domestic issuer
ratings) for Venezuela was last set at C with stable outlook
(March 2018).

Fitch's long term issuer default rating for Venezuela was last set
at RD (2017) and country ceiling was CC. Fitch, on June 27, 2019,
affirmed then withdrew the ratings due to the imposition of U.S.
sanctions on Venezuela.


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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 2019.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
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Information contained herein is obtained from sources believed to
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of the same firm for the term of the initial subscription or
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