Friday, March 16, 2007


Giuliani Law Firm Lobbies in Texas for Chavez-Controlled Citgo

By Henry Goldman and Jonathan D. Salant

March 14 (Bloomberg) -- Rudolph Giuliani's law firm lobbies for Citgo Petroleum Corp., a unit of the state-owned oil company controlled by Venezuelan President Hugo Chavez, the U.S.'s chief antagonist in the Western Hemisphere.

Bracewell & Giuliani LLP registered to lobby for Citgo in Texas on April 26, 2005, less than a month after the former New York mayor joined the firm and became a name partner, state records show. Citgo renewed the contract in 2006 and 2007 and pays the firm $5,000 a month to track legislation. Giuliani doesn't lobby, the firm says.

The law firm's representation of Citgo comes as Chavez's relations with the U.S. have grown increasingly hostile. He has called President George W. Bush a ``devil'' and a ``madman'' and staged a mass, anti-American rally in Buenos Aires during Bush's trip to Latin America, which ends today.

Patrick Oxford, a managing partner at Bracewell & Giuliani, said Giuliani, a Republican presidential hopeful, has no dealings with the Venezuelan-owned oil company. ``He has not seen hide nor hair of Citgo,'' Oxford said.

Giuliani's presidential-exploratory committee released a statement that didn't address written questions asking whether he knew his firm did business with Houston-based Citgo and whether he considered it appropriate. The e-mailed statement discussed his views toward Chavez and energy policy.

``Mayor Giuliani has been clear and consistent -- Hugo Chavez is no friend of the United States,'' campaign spokeswoman Katie Levinson said in the statement. ``Chief among the reasons Chavez has so much influence around the world is our ongoing dependence on foreign oil.''

No Disclosure

Giuliani, 62, has been active in business since leaving office at the end of 2001, making speeches, running a security- consulting company and an investment bank, and joining the Houston-based law firm. He hasn't yet had to file public disclosures of his client lists, income or holdings.

The U.S. State Department said in May that Venezuela was ``not fully cooperating with counter-terrorism efforts,'' and the U.S. government banned arms sales to the country.

Citgo has been fully owned by Venezuela's national oil company, Petroleos de Venezuela SA (PDVSA), since 1990. Chavez, 52, who earlier this year won the authority to supersede the Venezuelan legislature, has the power to appoint and fire PDVSA's top executives and set policy for the company.

Paying Dividends

Citgo spokesman David McCollum said PDVSA supplies Citgo with crude oil to refine and sell. ``We do pay dividends to them as any subsidiary does to its parent company,'' he said.

Venezuela is the third-largest oil producer in OPEC.

Texas Ethics Commission filings show Citgo paid Bracewell & Giuliani between $75,000 and $150,000 in 2005-06 and will pay an additional $50,000 to $100,000 this year. The firm monitors such issues as environmental regulation and taxes, Oxford said.

Bracewell & Patterson, the predecessor firm to Bracewell & Giuliani, did legal work for PDVSA in the 1990s, before Chavez came to power, and for Citgo before Giuliani arrived in 2005, Oxford said.

Oxford called Citgo ``an old-time U.S. company,'' saying it pays U.S. taxes and employs 5,000 people in the U.S., mainly in Texas.

In September, 7-Eleven Inc., which once owned Citgo, dropped the oil company as its gasoline supplier, citing in part Chavez's hostile rhetoric toward the U.S.

Building an Image

The law firm's association with a Venezuelan company may affect Giuliani's image, which was burnished by his role in coordinating New York's response after the 2001 terrorist attacks, said Linda Fowler, a professor of government at Dartmouth College in Hanover, New Hampshire.

The question, Fowler said, ``is how Rudy reconciles his heroic role as mayor of a devastated New York with the less appealing image of the corporate shill.''

Giuliani forged his post-Sept. 11 persona with such acts as rejecting a $10 million contribution for disaster relief from Saudi Prince Alwaleed Bin Talal Bin Abdul Aziz, after the prince said the U.S. should ``adopt a more balanced stand toward the Palestinian cause.''

A Richmond Times-Dispatch editorial last month contrasted Giuliani's gesture with former U.S. Representative Joseph Kennedy II -- son of the late U.S. Senator Robert Kennedy and president of the nonprofit Citizens Energy Corp. Kennedy has appeared in television commercials thanking Venezuela for providing discounted oil to heat homes of low-income U.S. residents.

The Feb. 15 editorial reminded readers that Giuliani ``scorned money he considered tainted.''

To contact the reporters on this story: Henry Goldman in New York at ; Jonathan D. Salant in Washington at .

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