HOUSTON, Aug 13 (Reuters) - An affiliate of hedge fund

Elliott Investment Management has raised its bid for the

Venezuela-owned parent company of U.S. refiner Citgo Petroleum

to a total value of $8.82 billion, according to a filing

providing an update on the court-organized auction.

The complex auction of PDV Holding, meant to repay 15

creditors for debt defaults and expropriations by Venezuela and

state oil company PDVSA, was relaunched in January after a

year-long bidding process ended in shambles amid arguments over

Citgo's worth and parallel legal cases.

A Delaware Court officer supervising the auction had last

month recommended a $7.4 billion bid by a group led by miner

Gold Reserve ( GDRZF ). But the court was last week notified of an

improved offer of $8.45 billion from a subsidiary of commodities

house Vitol, and the bid by Elliott affiliate Amber Energy

arrived later.

The court is scheduled to hold a hearing next week to make a

decision on the winner.

Amber Energy's increased offer includes a provision to pay

holders of a defaulted Venezuelan bond, according to a letter

filed on Tuesday by one of the creditors in the auction, Red

Tree Investments.

"Red Tree believes that Amber Energy is the highest bidder

for the PDVH shares under Delaware law and should be selected as

the winning bidder," the company said in the filing.

Amber Energy did not immediately reply to a request for

comment.

Citgo and PDV Holding are subsidiaries of Venezuela's state

oil company PDVSA. As part of the case, the Delaware court found

PDV Holding liable for Venezuela's debts, opening the doors for

the creditors to pursue the refiner to have their claims paid.