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UPDATE 1-Venezuela opposition hires veteran lawyer Buchheit to help restructure debt

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CARACAS, May 20 (Reuters) - Venezuela's opposition has hired veteran debt lawyer Lee Buchheit to help restructure the country's more than $150 billion debt burden, suggesting it could take a tough approach to dealing with investors holding defaulted bonds.

Buchheit, a former Cleary Gottlieb attorney who has represented several governments in debt talks with bond investors, published an academic article last year suggesting ways for a future Venezuela government to minimize debt repayments.

The move comes nearly four months into a power struggle between President Nicolas Maduro and Juan Guaido, the head of the opposition-controlled National Assembly who in January invoked the country's constitution to assume an interim presidency, arguing Maduro's 2018 re-election was illegitimate.

Guaido has been recognized as Venezuela's rightful leader by dozens of countries, including the United States, which has allowed his lawyers to represent the country in court battles with creditors. One court has granted a stay in suits against state-run oil company PDVSA for unpaid debts due to Venezuela's political crisis.

The most immediate task for a potential restructuring is protecting Citgo, a U.S. refiner owned by PDVSA. The opposition last week made a $71 million interest payment on bonds backed by shares in Citgo, but other creditors could still try to seize the company to collect on unpaid debt.

In late October, Buchheit co-authored the paper arguing that Venezuela would be a candidate to benefit from a potential U.S. executive order protecting its assets from seizure by creditors. That could facilitate an "orderly resolution" that would to the negotiating table even debtholders reluctant to accept losses on their holdings, he wrote.

Venezuela's information ministry did not immediately reply to a request for comment.

At the time, Buchheit had been working for Cleary, which represents a group of Venezuelan bondholders. He retired as a partner at the firm effective Feb. 19, Cleary said in a statement in response to an inquiry from Reuters at the time.

Buchheit had said he planned to retire from Cleary at the end of 2018 but his time at the firm was extended. He declined to further discuss the circumstances of his departure when consulted about it in February.

"Lee has great respect in the sovereign debt community and among commercial creditors, government lenders and public officials," said Ricardo Hausmann, the opposition's representative at the Inter-American Development Bank.

Buchheit will be representing Venezuela on a pro-bono basis, according to Jose Ignacio Hernandez, who Guaido has tapped as a special prosecutor representing the country's interests abroad. (Reporting by Deisy Buitrago; Writing by Daniel Flynn Editing by Luc Cohen, Andrea Ricci and Susan Thomas)