Bermudian-headquartered Gold Reserve Ltd is contesting a US court-appointed recommendation to designate Red Tree Investments as the lead bidder in the sale of Citgo Petroleum Corp's parent company, PDV Holding Inc.

A hearing on the objections is scheduled for April 17 in Wilmington, Delaware. ​

The legal dispute stems from a $7.1 billion bid submitted by Gold Reserve's US subsidiary, Dalinar Energy, which was not selected as the “stalking horse” bid.

Instead, the special master overseeing the sale process recommended a lower $3.7 billion offer from Red Tree Investments, an affiliate of Contrarian Capital Management. ​

The sale is part of a court-supervised process to satisfy more than $21 billion in claims against Venezuela and its state oil company, PDVSA, due to debt defaults and expropriations.

Gold Reserve, which holds a major arbitral award against Venezuela, has been actively pursuing avenues to recover its claims.