By Jill McLaughlin
The U.S. Treasury Department issued a general license on Feb. 10 authorizing the exploration, development, and production of oil and gas in Venezuela—a long-awaited step to help increase crude output from the country.
The license allows U.S. citizens to conduct specific oil and gas-related transactions with the Venezuelan government, including providing goods, technology, software, and services for exploration work, development of new oil and gas sites, or production.
The license also covers shipping, logistics, chartering vessels, insurance, and maintenance operations.
The move was expected to breathe new life into Venezuela’s state oil company PDVSA, which was forced to make deep output cuts after Washington imposed a strict blockade to pressure regime leader Nicolás Maduro in January. The blockage led to millions of barrels of crude building up on shore.
The Trump administration lifted some sanctions at the end of January, authorizing commodities traders Vitol and Trafigura to join Chevron to export Venezuelan oil last month, helping PDVSA offload some of the oil and clear the backlog.
The new license issued Feb. 10 prohibits any new oil and gas ventures or investment in Venezuela and transactions with Russia, Iran, North Korea, Cuba, and China.
It does not include payments in digital currency or gold and does not unblock previously frozen assets.
The license also says it does not authorize “the formation of new joint ventures or other entities in Venezuela to explore or produce oil or gas.”
President Donald Trump announced in January a plan by oil companies to spend $100 billion in Venezuela to boost its oil production following the capture and removal of Maduro.
The president said the dilapidated oil industry in the country could be rebuilt and bring millions of barrels of oil into the United States, boosting the economies of both countries, after major reconstruction takes place.
Companies included in a White House discussion about the plan were Chevron, ExxonMobil, ConocoPhillips, Continental, Halliburton, HKN, Valero, Marathon, Shell, Trafigura, Vitol Americas, Repsol, Eni, Aspect Holdings, Tallgrass, Raisa Energy, and Hilcorp.
