The company said its stakeholders approved a potential change in ownership structure and sent a proposal to OFAC, which issued the sanctions on PdVSA, inquiring if the change would exempt it from those sanctions.

“OFAC has now responded that the proposed changes are satisfactory and has also stated that when the proposal is executed, OFAC is ready to swiftly initiate its internal process for the removal of sanctions applicable to Nynas and prepare an appropriate public statement to that effect,” Nynas said in a statement issued March 12. “Nynas estimates that it will take a few weeks to implement the measures and actions required to satisfy OFAC’s demands, and Nynas is working intensely to carry these out as soon as possible.”

Nynas has not released details on what the ownership change would entail, but any alterations would most likely leave PdVSA with less stake in the company than it currently owns.

The sanctions at first essentially resulted in increased indirect costs for purchase and production of Venezuelan crude oil, and prevented the company from dealing in U.S. dollars, the main currency of the oil industry. Later in 2019, the sanctions were extended to include a prohibition on purchasing Venezuelan crude oil altogether.

Nynas also said that it is working to secure financing in order to keep its operations running. The company had larger than normal losses in January and February.

Although the company had developed a plan to return to profitability in three years, its banks were not persuaded to adjust the terms of the company’s loans, and subsequently blocked Nynas from accessing its accounts.

Those bank accounts have since been reopened so the company can pay off certain expenses it incurred since Dec. 13, Nynas said in a letter to its creditors published Jan. 3.

“Nynas has enough funds to cover operating costs during the reorganisation but lacks the funds to make all planned and necessary purchases of crude oil to maintain production volumes going forward,” the company said. “For this purpose, intensive negotiations are progressing with some of our largest customers for an agreement on financing for deliveries of a total of 500 to 600 million [Swedish kroner, or U.S. $51.2 to $61.4 million]. In addition, Nynas supporting financial advisor Carnegie Investment Bank is negotiating a short-term financing for the remaining SEK 400 to 500 million from another lender.”

Nynas believes that OFAC’s decision should give the courts and creditors more confidence in successfully completing its reorganization. “Both Nynas and the administrators expect a positive outcome of the application, and we will provide information about the district court’s decision once this has been made public.”

Companies based in Sweden that are facing financial trouble and looking to avoid bankruptcy can file for a company reorganization, a type of administration where court-appointed administrators work to restructure the firm. Companies must be deemed to have long-term business sustainability to enter reorganization, and it is only an option if the company is unable to pay its overdue debts. The process provides conditional protection against bankruptcy and imposes a moratorium on enforcement of existing agreements.

Nynas’s reorganization was scheduled to continue through March 13 – three months after it initially filed, which is standard procedure for reorganizations. The company has requested an extension of at least three more months.

Nynas operates two naphthenic base oil plants in Europe: a 400,000 metric tons per year facility in Nynashamn, Sweden, and a 330,000 t/y plant in Harburg, Germany.