OIL BOSSES HIT TRUMP WITH VENEZUELA SETBACK: "UNINVESTABLE"
Developing Venezuela’s oil industry following the removal of its leader, Nicolas Maduro, would require major legal and commercial changes, Exxon CEO Darren Woods has told President Donald Trump.
Woods gave a downbeat assessment of the viability of restoring oil production in the South American country believed to hold the world’s largest reserves, telling Trump that at the moment, the country’s industry was “uninvestable.”
Energy industry analyst, Thomas O’Donnell, told Newsweek on Saturday that one approach would be for companies to work on small projects to kickstart production before targeting the oil fields that require heavy investment.
When contacted for comment, the White House told Newsweek in a statement on Saturday after the arrest of Maduro, Trump “brokered a historic energy deal to further strengthen America’s national security in the Western Hemisphere.”
Why It Matters
Venezuela is said to have the world’s largest oil reserves, but the infrastructure required to tap these resources is dilapidated.
After the U.S. captured Maduro last week, Trump said U.S. oil producers were ready to spend $100 billion or more in rebuilding the infrastructure which could deliver the mutual benefits of a prosperous future for the Latin American country and a profitable enterprise for energy firms.
However, while energy chiefs have welcomed the removal of Maduro, Woods’ comments show the lack of firm commitment from oil executives to invest, as well as a degree of nervousness regarding the return on investment that could be seen after several years of heavy spending.
What To Know
During a livestreamed event in the White House with the heads of the firms including Exxon Mobil, Chevron and ConocoPhillips, Exxon CEO Darren Woods, said Venezuela was not a good investment unless legal and commercial changes were undertaken.
Woods said there had to be durable investment protections, and there has to be a change to the country’s hydrocarbon laws.
He said that the legal and commercial constructs and frameworks made the country’s oil sector “uninvestable” unless there were “significant changes”, although he added he was confident that the U.S. could make these changes and Exxon would likely soon put a technical team on the ground in Venezuela to assess its oil infrastructure.
Harold Hamm, a fracking executive and Trump ally, told the meeting that the country has challenges which the industry knew how to handle.
Chevron is the only major U.S. oil company still operating in Venezuela. Its vice chairman Mark Nelson told the gathering that it sees a path towards increasing its production by 50 percent in the next two years from its current 240,000 barrels a day with its partner, the Venezuelan state-run oil company, Petróleos de Venezuela SA (PDVSA).
Meanwhile, Jeffery Hildebrand, CEO of independent oil and gas producer Hilcorp Energy said his firm is “fully committed and ready to go to rebuild the infrastructure in Venezuela.”
Different Approaches
O’Donnell, who produces the website Globalbarrel.com, told Newsweek that it’s not just a matter of going into the big fields and making big investments, it could be a gradual process.
Production could be raised immediately by up to 40 percent simply by letting foreign companies back into the country with some minor equipment which would encourage firms to work on small projects, he said.
Another approach would be to focus areas such as around Lake Maracaibo, as there are oil fields that began to be exploited in the 1970s but were abandoned. Many of them were not depleted as the government in Caracas had claimed, there was just a lack of capacity and equipment.
Those mature fields could be recovered rather easily by smaller companies and as there are some pipelines working in those areas which would need to be improved to get that oil to ports, said O’Donnell.
That would raise a significant amount of money and allow time to further develop the sector ahead of the areas that require long-term investment of billions of dollars, such as in the Faja del Orinoco, where the extra heavy oil is.
Companies can go into those regions now but they would need to upgrade the oil to make it lighter so it can flow through pipelines. Heavy oil can be extracted and mixed with dilutants and exported to U.S refineries, which would be a way getting started while the longer-term repairs to the high-tech equipment is undertaken, O’Donnell added.
What People Are Saying
President Donald Trump: “Our giant oil companies will be spending at least $100 billion of their money, not the government’s money.”
Exxon CEO Darren Woods: “If we look at the legal and commercial constructs and frameworks in place today in Venezuela today, it’s uninvestable.”
He added: “There has to be durable investment protections, and there has to be a change to the hydrocarbon laws in the country.”
Fracking executive Harold Hamm: “It is a very exciting country and a lot of reserves—it’s got its challenges and the industry knows how to handle that.”
White House spokesperson Taylor Rogers told Newsweek in a Saturday statement: “Immediately following the successful arrest of narcoterrorist Maduro, President Trump brokered a historic energy deal to further strengthen America’s national security in the Western Hemisphere and help restore Venezuela as a responsible, prosperous ally of the United States. This is one of the countless good energy deals President Trump has brokered to restore American energy dominance that will benefit the American people, American energy companies, and the Venezuelan people.”
Energy analyst Thomas O’Donnell: “There’s a process. It’s not just a matter of going into the big fields, making big investments, big commitments. You can begin gradually.”
What Happens Next
Even with the caveats expressed by oil chiefs, the potential for developing Venezuela’s reserves is likely to be a priority for the Trump administration.
Energy secretary Chris Wright said the $100 billion figure cited by Trump was an estimate for reconstructing Venezuela’s oil sector rather than a firm spending commitment from oil firms.
Update 01/10/26, 11:36 a.m. ET: This article has been updated with a White House statement.
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2026-01-10T14:38:40Z
