Gold Reserve Ltd. (TSX.V: GRZ, OTCQX: GDRZF) has lost a key legal challenge in the ongoing sale of shares in PDVH, the parent company of U.S.-based CITGO Petroleum Corporation. The U.S. District Court for the District of Delaware ruled in favor of a $5.9 billion bid submitted by Elliott Investment Management and Amber Energy, rejecting a higher, fully financed $7.9 billion offer submitted by Gold Reserve in partnership with Dalinar Energy. The court’s endorsement of the Special Master’s recommendation marks a significant setback for the Canadian mining and arbitration-focused firm, which has spent years attempting to monetize its arbitration award against the Venezuelan state.
The decision, handed down on November 25, 2025, came despite formal objections raised by Gold Reserve and joined by other creditors including Siemens Energy, Inc., Valores Mundiales S.L., and Consorcio Andino S.L. The Venezuela-aligned opposition parties, including representatives of the internationally recognized interim government, Petroleos de Venezuela SA (PDVSA), PDVSA Holding Company, and CITGO Holding Inc., also voiced their disapproval of the court’s chosen buyer.
The Delaware court ordered all parties to submit a joint status report by November 28 and indicated that a final sale order would be issued by or before December 1, 2025. However, the Elliott-led transaction still requires a license from the U.S. Treasury’s Office of Foreign Assets Control and other regulatory approvals before closing can occur.
Why the Delaware court ruled in favor of Elliott’s lower-priced offer
The Delaware District Court’s decision to back the Elliott and Amber Energy offer over the significantly higher proposal by Gold Reserve and Dalinar Energy hinged on a number of non-price factors. The Special Master appointed to oversee the process had recommended the Elliott bid based on perceived execution certainty and regulatory clearance probability. According to court documents, the Elliott proposal was deemed more actionable and less prone to delays, particularly in relation to U.S. sanctions compliance and Office of Foreign Assets Control licensing.
In contrast, Gold Reserve argued that its $7.9 billion offer was fully financed and provided materially superior value to creditors. The company maintained that it was unjustly disadvantaged by a process it claimed was riddled with structural conflicts of interest. Specifically, Gold Reserve highlighted that the advisors to the Special Master had reportedly received $170 million in fees from entities affiliated with Elliott Management and the 2020 bondholder group aligned with the winning bid.
Despite these concerns, the court sided with the recommendation of the Special Master. Analysts familiar with sovereign asset enforcement cases suggested that courts often favor deals with a clearer regulatory path even if they come at a lower financial value, particularly when sovereign sanctions are involved. The decision appears to reflect the court’s prioritization of closing certainty over maximizing bid proceeds, especially in light of the complexities surrounding CITGO’s ownership and the broader Venezuelan debt litigation landscape.
How creditors and Venezuelan stakeholders reacted to the outcome
The court’s decision to favor the Elliott-led bid drew sharp criticism from several creditor groups and Venezuelan opposition entities. Gold Reserve’s objections were joined by Siemens Energy, Valores Mundiales, and Consorcio Andino, all of whom argued that the bidding process failed to maximize value for creditors. These parties contended that the Special Master’s recommendation ignored the superior financial terms of the Gold Reserve–Dalinar Energy proposal and failed to adequately address serious conflict-of-interest concerns.
Additionally, entities aligned with the Venezuelan opposition government, including PDVSA and CITGO Holding Inc., submitted their own objections. These filings underscored the geopolitical and strategic stakes involved in the CITGO sale, noting that ownership transfers could have implications for future control of Venezuelan assets and creditor negotiations.
The court acknowledged the objections but ultimately dismissed them, finding that the Special Master’s recommendation satisfied the legal requirements of the sale process. The ruling also included a procedural safeguard allowing parties time to seek further relief through appellate channels before the transaction becomes irrevocable.
What is Gold Reserve’s next move after the court’s decision
Gold Reserve stated that it “respectfully disagrees” with the Delaware court’s decision and will explore all available avenues to challenge the outcome. The Canadian resource company, which is also listed on the Bermuda Stock Exchange under the symbol GRZ.BH, has made clear its intention to pursue appellate remedies and seek a stay on the final sale order pending further review.
The company’s objections have consistently emphasized transparency, fairness, and valuation integrity. In public filings and previous statements, Gold Reserve accused the process of favoring parties with insider relationships and flagged what it believes to be improper financial entanglements between the Special Master’s advisors and the Elliott-affiliated bidder group.
Legal experts following the case said the most likely next step for Gold Reserve would be to appeal to the U.S. Court of Appeals for the Third Circuit. The firm could also seek emergency relief to delay the issuance of a final sale order or attempt to block the regulatory approvals required to close the Elliott transaction. These moves would not only extend the litigation timeline but could complicate the path forward for any CITGO-related enforcement actions in U.S. courts.
Why the Elliott-led deal is still not guaranteed to close
Despite winning the court’s approval, the Elliott and Amber Energy offer for the PDVH shares is not yet finalized. The Delaware court explicitly stated in its November 25 order that the closing of the transaction is stayed until seven days after the Special Master submits a notice confirming that all regulatory and licensing requirements have been met. This includes the critical condition of obtaining a license from the U.S. Office of Foreign Assets Control.
The court’s stay period is intended to give objecting parties sufficient time to seek further judicial relief or emergency injunctions from higher courts. Analysts tracking sovereign enforcement litigation noted that the OFAC process could become a focal point for renewed opposition. Although Elliott has a long track record of navigating complex sovereign claims and U.S. sanctions regimes, the involvement of Venezuelan assets and politically sensitive parties makes this a particularly high-stakes review process.
Furthermore, any delays in obtaining OFAC clearance or other federal approvals could create opportunities for Gold Reserve or other creditors to revisit the sale process through legal or procedural mechanisms. For now, the path to finalizing the PDVH transaction remains uncertain and politically fraught.
How Gold Reserve’s arbitration win against BANDES fits into the broader strategy
On the same day the Delaware court issued its decision, Gold Reserve announced a separate legal victory in its arbitration case against Banco de Desarrollo Económico y Social de Venezuela (BANDES), the state development bank of the Maduro-led government. The arbitration tribunal awarded Gold Reserve Corporation, an affiliate of Gold Reserve Ltd., a total of $28.98 million, including pre-award interest, plus €434,000 in costs. The tribunal also awarded post-award interest at the 12-month SOFR plus 2 percent until full payment is received.
The arbitration stemmed from funds held in trust by BANDES on behalf of Gold Reserve. Although the full terms of the award remain confidential, the ruling adds to Gold Reserve’s growing legal arsenal against the Venezuelan state and its affiliated institutions. The company indicated it would pursue recognition and enforcement of the BANDES award in Portuguese courts, where related proceedings are currently underway.
The arbitration victory, while smaller in scale than the PDVH litigation, underscores Gold Reserve’s broader strategy of using international tribunals and court systems to extract value from its Venezuela-linked claims. The firm remains one of the most aggressive litigants in the post-ICSID arbitration enforcement arena and continues to pursue recovery of its $1 billion arbitration award dating back to the cancellation of its mining concessions in Venezuela.
What investors and legal observers should watch in the final weeks of 2025
The next key milestone in the PDVH saga will be the joint status report due by November 28, followed by the anticipated final sale order on or before December 1, 2025. Market participants will be watching closely for any new motions filed by Gold Reserve or other objectors, as well as signals from OFAC regarding the pending license application.
The Delaware court’s ruling also sets a precedent for how future sovereign asset sales may be adjudicated when conflicting interests, sanctions regimes, and multiple creditor claims are involved. With Venezuela’s complex debt restructuring outlook still unresolved, this case is likely to have ripple effects across other pending litigation in U.S. and international courts.
For Gold Reserve, the months ahead will test its ability to convert legal wins into tangible recoveries. The outcome of its appeals and enforcement actions could reshape the company’s financial outlook and reframe how arbitration award holders strategize for asset recovery in politically sensitive contexts.
What are the key takeaways from Gold Reserve’s loss in the CITGO sale dispute and next steps for investors?
- The U.S. District Court for the District of Delaware approved the $5.9 billion Elliott/Amber Energy bid for PDVH, the parent of CITGO Petroleum, over Gold Reserve’s higher $7.9 billion fully-financed offer with Dalinar Energy.
- Gold Reserve’s objections were joined by major creditors like Siemens Energy and Venezuelan opposition parties, citing conflict-of-interest concerns and better value in their offer.
- The court sided with the Special Master’s recommendation, prioritizing deal certainty and regulatory clearance over bid size.
- Elliott’s deal must still obtain an OFAC license and other approvals, with the court pausing closing for at least seven days after approvals are announced.
- Gold Reserve plans to appeal the decision and is exploring other legal and regulatory avenues to contest the sale.
- In a separate but related legal milestone, Gold Reserve also won a $28.98 million arbitration award against Venezuela’s state bank BANDES, which it plans to enforce in Portugal.
- A final sale order from the Delaware court is expected on or before December 1, 2025, pending updates due by November 28.
- Analysts believe the ruling sets a precedent for future sovereign asset sales, especially in cases involving U.S. sanctions and multiple creditor claims.
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