[R-G] Venezuelan firm says it never ended deal with Citizens Energy

[Anthony Fenton]

Citgo continues support of free heating oil plan
Venezuelan firm says it never ended deal with Citizens Energy
By Nicole C. Wong and Todd Wallack
Globe Staff / January 8, 2009
http://www.boston.com/business/personalfinance/articles/2009/01/08/citgo_continues_support_of_free_heating_oil_plan/

It turns out you'll be able to call Joe for free oil after all.

Venezuelan company Citgo Petroleum Corp. said yesterday it plans to  
continue supporting a program run by Joseph P. Kennedy II that  
provides free heating oil to 200,000 low-income households in 23  
states, including Massachusetts - just two days after Kennedy said  
Citgo was indefinitely suspending the program.

On Monday, Kennedy, the president of Citizens Energy Corp., said Citgo  
had to suspend contributions because of plunging oil prices and the  
widening recession, which hurt its revenue. As a result, Kennedy  
warned, he might have to cut the program by one-fifth in Massachusetts  
and shutter it completely in other states this year unless he could  
raise other contributions or persuade Citgo to change its mind. He  
also said Citizens would lay off 20 staffers and delay the contracts  
for operating its application processing call centers.

Both companies said Citgo told Citizens in December that it had to  
reevaluate all of its charitable commitments - a process that was  
still underway this week. But that's where the agreement ends.

"We never stopped the program," Citgo chief executive Alejandro  
Granado said twice at a press conference yesterday in Citizens  
Energy's office in South Boston.

Citizens, which had publicized it would start taking applications on  
Jan. 5 from people who needed help heating their homes, said it  
thought Citgo's indecision meant the program would be suspended.

"We were put in a position where we were unable to take the  
applications," Kennedy said. "It took a few days longer than we could  
manage."

Since Kennedy said the program would be suspended, Citgo and  
Venezuelan President Hugo Chávez have been swarmed by political  
pressure. The Venezuelan government owns Citgo, the US distribution  
arm of Venezuela's state oil company, Petroleos de Venezuela, which  
Chávez indirectly controls.

Kennedy would not say whether he talked to Chávez this week, but the  
former Massachusetts congressman said he discussed the situation with  
several members of Congress and "did what was necessary to make this  
work."

US Representative Bill Delahunt, Democrat from Quincy, who helped  
negotiate the original deal with Chávez at a meeting in Caracas  
several years ago, said he and other members of Congress personally  
contacted Chávez after learning the program was in jeopardy.

"It's really important to continue the program," Delahunt said. "In  
New England, it has been extraordinarily helpful to get low-income  
people through the tough winters we have had." Delahunt said he  
thought the program could also pave the way for better relations  
between the United States and Venezuelan governments. Chávez has been  
a critic of the US government.

Granado said he talked to Chávez yesterday morning and was given the  
go-ahead to continue the program. Citizens said it will start  
accepting applications on Jan. 19 and expects home deliveries to begin  
two to three days later.

Kennedy has frequently touted this three-year-old program in  
television commercials, urging people to call 1-877-JOE-4-OIL. Under  
the program, residents in 16 states were able to obtain up to 100  
gallons of free heating oil last year. The program also provides  
grants to Native American tribes in other states to help members heat  
their homes.

But social service groups point out Citizens' program is just one of  
many to help low-income families heat their homes. For instance,  
residents can call the state heating assistance hotline at  
800-632-8175, and the Salvation Army and Massachusetts energy  
companies run the Good Neighbor Energy Fund to help residents pay  
their electric, gas, and oil bills. A coalition of state utilities and  
community programs also runs a website, www.energybucks.com, which  
points consumers to other resources.

Nicole C. Wong can be reached at nwong at globe.com; Todd Wallack at twallack at globe.com