Oil company executives tell Trump that under current conditions Venezuela is ‘uninvestible’
The head of U.S. oil giant Exxon Mobil on Friday told President Donald Trump that Venezuela is “uninvestible” under current conditions, saying major changes were needed before his company would return to the country that has seen its crude oil resources sink into disrepair.
An abandoned oil field in Venezuela.
The comments by Exxon CEO Darren Woods were a blow to Trump’s hopes that American oil majors would move quickly to make big investments in Venezuela — and cast doubt on the president’s insistence that U.S. companies are prepared to spend $100 billion or more.
“If we look at the legal and commercial constructs and frameworks in place today in Venezuela today, it’s uninvestable,” Woods told Trump in a White House meeting packed with fellow oil and gas executives. “Significant changes have to be made to those commercial frameworks, the legal system. There has to be durable investment protections, and there has to be a change to the hydrocarbon laws in the country.”
Still, Woods said he was confident the U.S. can help make those changes, and said he expected Exxon could put a technical team on the ground in Venezuela soon to assess the state of its oil infrastructure.
Harold Hamm, a fracking company executive and major Trump ally, expressed more enthusiasm, but also reservations about making any commitments.
“It excites me as an explorationist,” said Hamm, whose experience has centered on oil production inside the U.S., said of the opportunity to invest in Venezuela. “It is a very exciting country and a lot of reserves — it’s got its challenges and the industry knows how to handle that. At this point, I think it’s a wait and see situation for the industry – no one wants to rush in.”
Hamm added that oil prices are currently headed down, possibly below the $50 per barrel mark, which is below the break-even mark for many producers.
Trump said during the meeting that companies that invest in Venezuela would be assured “total safety, total security,” though he provided no indication of how the U.S. would guarantee that without spending taxpayer dollars or putting boots on the ground.
Before the executives spoke, Trump insisted that oil companies are lining up to take the administration up on the opportunity. “If you don’t want to go in, just let me know,” he said. “There are 25 people not here today willing to take your place.”
Following the meeting, reporters over-heard Woods tell an aid to Trump, “Please explain to your boss how the oil market works.
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Credit: United Press International, Politico
