Chevron Corp. has made clear that its willingness to put fresh money into Venezuelan oil operations hinges on a change in fiscal terms from Caracas. Chief Executive Officer Mike Wirth said the company needs reductions in corporate income tax and production royalties before it will deploy new capital in the country next year.
At present, Chevron is the only U.S. oil major still operating in Venezuela and is constrained to reinvest revenue earned inside the country under a U.S. Treasury-sanctioned arrangement that allows the company to recover debts from state-owned Petroleos de Venezuela SA (PDVSA). Wirth told Bloomberg TV that with oil trading at roughly $100 a barrel through much of the last two months, Chevron expects the debt recovery program to be completed within a year.
Executives from Chevron, Exxon Mobil Corp. and ConocoPhillips have held recent meetings with officials from the government led by acting President Delcy Rodriguez. Those discussions are focused on negotiating updated terms and formalizing contracts after Venezuela revised its oil and gas legislation earlier this year - a development that followed the U.S. capture of former leader Nicolas Maduro, according to the details cited.
President Donald Trump has publicly encouraged U.S. oil companies to invest up to $100 billion to restore Venezuela’s oil sector. Despite that call, oil company leaders remain cautious, noting concerns tied to Venezuela’s track record on nationalizations, the possibility of shifting contractual arrangements and security conditions on the ground.
Chevron currently produces about 250,000 barrels per day in Venezuela through joint ventures with PDVSA. Wirth said that negotiations were taking place this week and that the company expects to obtain specific clarity on the levels of corporate tax and royalties in the near term.
Context and next steps
Chevron's position links any new investment to explicit fiscal concessions from Venezuelan authorities. The immediate focus for the company and its U.S. peers is finalizing taxable rates and royalty formulas that would underpin future capital allocations, while officials await the outcomes of the ongoing talks.