U.S. oil giants signaled interest in Venezuela on Friday but stopped well short of committing to massive and rapid new investments there during a meeting with President Trump.
Why it matters: The White House envisions a key role for U.S. companies in reviving output from Venezuela following the toppling of President Nicolás Maduro.
- But despite expressions of interest from some independent companies, Exxon and other oil giants appeared more cautious than Trump, who declared at the outset he was anxious to make deals as soon as "today."
- He foresees a mix of U.S. and other companies spending $100 billion in Venezuela.
Driving the news: Trump said that U.S. companies would have security guarantees. But he didn't provide details or commit to a U.S. military presence, while citing the industry's experience operating in difficult venues.
- He also said oil companies would be "dealing with us directly. You're not dealing with Venezuela or we don't want you to deal with Venezuela."
Reality check: Exxon CEO Darren Woods said Venezuela is currently "uninvestable" without "significant changes" to commercial frameworks and the legal system.
- "There has to be durable investment protections, and there has to be change to the hydrocarbon laws in the country," Wood said in his first public remarks since Maduro's ouster.
ConocoPhillips CEO Ryan Lance cautioned the need for discussions with banks — likely including Export-Import Bank of the U.S. — "as we think about how the debt needs to be restructured in the financing to deliver the billions of dollars that are required to restore their energy infrastructure."
- And though he said his company "stands ready to help," he cited the need to broadly restructure the country's energy system.
- His company, like Exxon, exited Venezuela's nationalized sector around two decades ago in a dispute with then-President Hugo Chávez's regime and had its assets expropriated.
And Chevron, the only U.S. company operating in Venezuela, also sounded a note of caution in a statement following the meeting.
- "Our focus remains on the safety of our people, and the integrity of our assets in strict compliance with all laws and regulations applicable to its business, as well as the sanctions frameworks provided for by the U.S. government," the company said.
Catch up fast: Venezuela has massive oil reserves. But it has seen production dwindle after decades of mismanagement, underinvestment and — in more recent years — U.S. sanctions.
Yes, but: Several companies at Friday's meeting did signal a willingness to invest.
- Jeffery Hildebrand, chairman of the independent producer Hilcorp Energy, told Trump that his firm is "fully committed and ready to go to rebuilding the infrastructure in Venezuela."
Zoom in: Top U.S. officials offered broad outlines of their approach ahead of the session with the execs.
- Energy Secretary Chris Wright and Interior Secretary Doug Burgum, in separate TV interviews before Friday's meeting, downplayed but didn't rule out U.S. financial assistance or incentives.
- "The discussions right now have been that the capital is going to come from the capital markets and come from the energy companies," Burgum told Bloomberg TV.
- "If we can provide a secure, stable environment, the resource here is so significant and so large that it's going to be attractive for people to go in and develop that," he said.
Wright, appearing on Fox News, said the Export-Import Bank of the U.S. might provide "credit support" for "large projects."
The intrigue: The two men and other Trump officials also pushed back against skepticism about oil companies' appetite for new investment in Venezuela, saying they're already getting inbound interest from firms of various sizes, including independent players.
- Chevron Vice Chairman Mark Nelson, whose company now produces around 240,000 barrels per day there, expressed confidence in substantially increasing that over the next 18 to 24 months.
- But getting the country back to the 3.5 million barrels-per-day level of the late 1990s is what could require well north of $100 billion worth of investment over a decade or more, according to some analysts.
- Venezuela currently produces around 800,000 barrels per day.
What we're watching: Wright, on MS Now's "Morning Joe," said the initial increases in activity will be among oil and gas companies that already have a presence in Venezuela, which currently remains under sanctions.
- In addition to Chevron, which produces under a special U.S. license, European multinationals Repsol, Eni and Shell — who were on Friday's attendee list —have various holdings there.
Editor's note: This story has been updated with new reporting on Chevron's plans.
