Probe Sought of Citgo Ties With Iran

UNITED NATIONS — A Republican lawmaker is asking the Bush administration to investigate whether the energy company owned by the Venezuelan government, Citgo, benefits illegally from President Chavez's affinity for doing business with Iranian mullahs.

The probe could lead to imposing sanctions on the gas station operator's businesses in America. The ranking Republican of the House Foreign Affairs Committee, Rep. Ileana Ros-Lehtinen of Florida, wrote Secretary of State Rice and Treasury Secretary Paulson yesterday, requesting an investigation into an agreement that was reportedly signed between Citgo's parent company, the government-owned Petróleos de Venezuela SA, and the Iranian oil company Petropars. According to reports cited in Ms. Ros-Lehtinen's letter, Iran and Venezuela last fall announced a $1 billion joint venture between the two state-owned companies, forming a new entity, the Venezuelan-Iranian Oil and Gas Co.

In her letter, Ms. Ros-Lehtinen requested that the administration investigate whether such an agreement violates "the letter or the spirit" of the Iran Sanctions Act; whether Citgo benefits from the agreement, and whether it benefits "directly or indirectly" from Venezuela's investment in Iran or Iranian investments in Venezuela.

The Iran Sanctions Act, which was amended last year, requires the president to impose at least two of a menu of several financial sanctions on any entity that invests "more than $20 million in one year in Iran's energy sector." Citgo's U.S. operation, based in Houston, operates 14,000 retail outlets in America, including gas stations and other petroleum-related products. "We're a major supplier and refining giant with a directly owned or operated refining capacity of 750,000 barrels per day," Citgo's Web site states. A company spokesman, Fernando Garay, said yesterday that the company is "reviewing" Ms. Ros-Lehtinen's letter and intends to respond at a later time.