Chevron speeds ahead in Venezuela while Exxon urges caution with a ‘little pinch of salt’ | Fortune
Exxon Mobil Chief Executive Darren Woods is advising market observers to view recent reports of the company's potential return to Venezuela with a little pinch of salt. While rumors circulated a month ago suggesting Exxon was nearing a memorandum of understanding for oilfield exploration, Woods remains cautious about any immediate exuberance. He maintains that while the energy giant will ultimately have a role in the nation, the timing must be right.
Exxon Remains Cautious on Venezuela
This hesitation follows a January meeting at the White House where Woods described the South American country as uninvestible. That assessment drew criticism from President Donald Trump, who characterized the company's stance as playing too cute. The friction occurred following the military ouster of former leader Nicolás Maduro by U.S. forces. During a third-quarter earnings call this Friday, Woods stood by his previous rhetoric, noting that Exxon has endured the nationalization of its assets in Venezuela twice, with the most recent seizure occurring in 2007.
Woods explained that substantial modifications to historical operating procedures in Venezuela are necessary before Exxon commits capital. He acknowledged that progress is occurring regarding legal and fiscal frameworks, but emphasized that there is still a way to go. The CEO stated that the company is being methodical and thorough rather than rushing, as they seek a sustainable project capable of generating the returns needed to compete within their global portfolio. Woods also noted that only a few firms, including Exxon, possess the scale required to operate successfully in the region.
Chevron Expands Production and Infrastructure
In contrast to Exxon's wait-and-see approach, Chevron is accelerating its operations. As the primary private producer currently active in the country, Chevron never fully exited and maintained a working relationship with the Maduro regime. CEO Mike Wirth pointed out that being the only incumbent on the ground provides a significant advantage in understanding local infrastructure and geology. Chevron recently secured a deal to double its output from 300,000 barrels of oil per day to 600,000 barrels by the year 2031.
Chevron has already increased its volumes by 20% this year, rising from a baseline of 250,000 barrels daily. Wirth described the investment as low-risk, noting the projects will be self-funding following the initial capital injections. Other industry players are also moving forward. Continental Resources, led by billionaire Harold Hamm, recently signed a memorandum of understanding with the state-run oil company PDVSA to develop assets in the prolific Orinoco Belt. Meanwhile, BP and Shell are targeting offshore gas fields located near Trinidad and Tobago.
Trump Announces Historic OIL Deal
The Trump administration is also facilitating a massive expansion of American influence in the sector. In late August, the president announced what he described as the biggest oil deal in world history, claiming the United States would oversee more than 65 billion barrels of proven reserves across 17 Venezuelan oilfields. This arrangement functions through North American Blue Energy Partners (NABEP), the second-largest private producer in the country. Under the terms of the agreement, the U.S. Department of Defense would hold a 35% stake in NABEP and maintain control over the majority of production.
These developments come as Venezuela attempts to revive an industry that has fallen into significant disrepair. While the nation holds the largest proven oil reserves on paper, its production peaked decades ago at nearly 4 million barrels per day. Recent data shows a slight recovery, with October output exceeding 1.2 million barrels daily, up from previous levels below 1 million.
Source: fortune.com · 2026-10-31