Chevron to invest $7 billion to double oil production in Venezuela — Fortune
Chevron is investing $7 billion in Venezuela and expects to increase oil production from 300,000 to 600,000 barrels per day by 2031. At the same time, ExxonMobil says the country needs further changes to fiscal and legal regulations before a decision on significant investments can be made, Fortune reports.
ExxonMobil is in no hurry to invest
ExxonMobil CEO Darren Woods, during the presentation of the company’s quarterly results, called for caution regarding reports of a possible signing of a memorandum on investments in Venezuelan oil fields. According to him, the company may eventually play a role in Venezuela, but it does not intend to rush.
Woods said ExxonMobil is ready to consider projects only once conditions emerge that ensure the viability, stability and required profitability of investments. He also recalled that ExxonMobil’s assets in Venezuela were nationalized twice, most recently in 2007.
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Chevron increases production
Chevron, which did not leave Venezuela and remains the country’s largest private oil producer, has already increased production volumes by 20% this year — from 250,000 barrels per day. Total production in Venezuela exceeded 1.2 million barrels per day in October, according to the publication, compared with less than 1 million barrels per day previously.
Chevron CEO Mike Wirth said the company’s presence in the country gives it an advantage due to its knowledge of the geology and infrastructure. He described the drilling program as one that could pay for itself quickly and whose pace can be adjusted depending on market conditions. According to Wirth, the new contract terms include provisions on political stability and international arbitration, while Chevron will control the flows of oil it produces, as well as the royalties and taxes it pays to the government.
Other companies are also looking at Venezuela’s oil sector. Continental Resources has signed a memorandum with state-owned PDVSA on developing a large area in the Orinoco Oil Belt, while BP and Shell are planning investments in offshore gas fields near Trinidad and Tobago.
