Oil companies expand investments in Venezuela despite operational challenges

Representatives of international oil companies said on Tuesday in Caracas that they are willing to expand operations in Venezuela, despite the deterioration of infrastructure and the operational problems facing the industry, according to AlbertoNews.

The meeting brought together executives from Repsol, Siemens, Hunt Oil, Maurel & Prom and the Qatari firm UCC Oil and Gas Holding during the International Oil and Gas Summit of Venezuela. The corporate presence came amid the opening of the oil sector to private capital promoted by the administration of acting president Delcy Rodríguez, under the supervision of the United States.

Venezuelan oil production stands at about 1.2 million barrels per day, far below the more than three million barrels the country pumped two decades ago, AlbertoNews reported. The industry has suffered years of underinvestment and lack of maintenance, management problems at Petróleos de Venezuela and the impact of international sanctions.

For its part, the newspaper El Estímulo said that licenses issued by the Office of Foreign Assets Control widen the room to trade crude and negotiate investments, but warned that no new investment can get underway without a case-by-case permit from Washington and that the money still flows through accounts controlled by the U.S. Treasury.

Along the same lines, El Nacional reported that the update aims to boost oil production and electrical infrastructure, while maintaining clear limits, such as the ban on creating new joint ventures and the veto on diluent supplies.