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LatAmOil VENEZUELA LatAmOil
Chevron is not quitting Venezuela, CEO says
MIKE Wirth, the CEO of Chevron, said last week that his company did not intend to make a complete exit from Venezuela. He was speaking less than two weeks after officials in Washing- ton instructed the US major to “wind down” its operations in the South American country.
Wirth told CNBC in an interview on May 1 that Chevron was not under obligation to exit Venezuela, since the US Treasury Department had not explicitly ordered it to do so. He also stated that the US government’s instructions did not cover all of the company’s operations in that country, which include non-operating interests in joint ventures with the national oil company (NOC) PdVSA.
“We’ve been in Venezuela for the better part of the last 100 years, and the Treasury Depart- ment has issued repeated 90-day licences that allow us to remain in the country,” he said, referring to the past issuance of waivers from sanctions. “We don’t actually operate any assets in Venezuela. “The licences have gradually restrained the kinds of activities that we can do as a partner in these ventures. The most recent licence ... asks us to wind down or requires us to wind down certain additional activities that pre- viously we’ve been allowed to do. It doesn’t actu- ally require us to leave the country. It restricts activity to a smaller set of the things that are required as part of this venture.”
Wirth also stressed, though, that Chevron would abide by the US government’s restric- tions on its Venezuelan operations. “We intend to comply, obviously, with the requirements of the government, but we’re not actually winding down or leaving the country,” he told CNBC. “We’re winding down certain activities.”
The Chevron CEO did not elaborate. He did note, though, that the company hoped to main- tain a foothold in Venezuela even if it did have to reduce the scope of its activities.
“We’re still able to pay our people [and] support communities in Venezuela, which is very, very important in a time like this,” he said. “Hopefully, [we can] preserve our position in these important businesses, so we can be pre- pared to go forward once the situation in the country improves.”
The Treasury Department began issuing licences that exempted Chevron from penal- ties under the sanctions regime in 2019. It has repeatedly renewed those licences, initially for periods of six months and later for periods of three months.
In the latest licence, though, the department said it expected Chevron to “wind down” its activities in Venezuela by December 1. It also declared that the company no longer had per- mission to drill wells in the South American country or to buy, sell or transport crude oil or petroleum products there.
Washington introduced sanctions against Caracas in a bid to put pressure on Venezuelan President Nicolas Maduro. The US government supports claims by Venezuelan opposition leader Juan Guaido that Maduro used fraudu- lent means to win re-election in late 2018.
Guaido was named interim president more than a year ago but has not been able to secure Maduro’s departure from power. His allies have secured control over the US-based refiner Citgo, which is one of the most valuable assets owned by the national oil company (NOC) PdVSA, but Maduro still holds PdVSA. ™
Petropiar is one of Chevron’s joint ventures in Venezuela (Photo: PdVSA)
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w w w . N E W S B A S E . c o m Week 18 07•May•2020