Lots Of Companies Are Eager To Spend In Venezuela — Except The Ones Trump Most Needs

The giant energy companies most capable of rebuilding Venezuela’s shattered oil fields are also the most skeptical about heeding President Donald Trump’s call to pour money into the country.

That still leaves plenty of smaller oil, mining, finance and other businesses clamoring for the chance to jump in — and jamming the White House phone lines for a chance to do so, Treasury Secretary Scott Bessent said Thursday, echoing comments that others familiar with the situation had made to POLITICO.

“One of the things that has been incorrectly reported is that the oil companies are not interested in Venezuela,” Bessent told an audience at the Economic Club of Minnesota, according to a transcript supplied by the department. “The big oil companies who move slowly, who have corporate boards are not interested. I can tell you that independent oil companies and individuals, wildcatters, [our] phones are ringing off the hook. They want to get to Venezuela yesterday."

The oil industry’s divide over Venezuela will be just one of the complications lurking in the backdrop of a White House meeting Friday that is expected to include Trump and executives from several big companies with experience in the South American country, including U.S.-based Exxon Mobil, Chevron and ConocoPhillips. The meeting comes nearly a week after the U.S. military carted away Venezuelan leader Nicolás Maduro.

While Trump has publicly pressured American oil giants to spend billions of dollars reopening Venezuela, the companies with the biggest pots of money and longest experience in the country are unsure it would be in their best interests — or even possible, according to six oil company executives and industry lobbyists who were granted anonymity to candidly discuss the White House’s conversations with the private sector.

Energy Secretary Chris Wright and Interior Secretary Doug Burgum are also expected to attend Friday’s meeting, along with European oil producers Shell, Repsol and Eni, people familiar with the plans said. All those companies had rigs, pipelines and other assets in Venezuela before former leader Hugo Chávez appropriated foreign companies' assets to merge with the state-owned Petróleos de Venezuela.

Global commodity trading firms Vitol and Trafigura are also expected to attend. The Trump administration is having those European companies market the oil it receives from Venezuela, as POLITICO reported Wednesday.

The oil giants have a ton of questions, energy policy veterans said.

“They will make the investments,” former Trump Energy Secretary Dan Brouillette said of the oil companies attending Friday’s White House meeting. “They will do the patriotic thing. They’ll help out. But what they also want to know is that the U.S. policy is not going to change in 24 hours. They can’t have that, and I think that’s what they’re going to say [Friday] in these meetings.”

Even so, the opportunity to reap a high-risk, high-reward windfall in Venezuela has drawn interest from a wider panoply of companies large and small, people knowledgeable about those discussions said.

Those include private equity firms and companies looking to construct roads, build bridges, repair the country's telecom services, drill for oil and mine for critical minerals in what had decades ago been one of South America’s biggest economies.

“The most enthusiastic are among the least prepared and least sophisticated,” said one industry official familiar with the general responses the White House is receiving from a variety of businesses. “Anyone with a degree of international sophistication is taking a more measured approach.”

Stephen Brown, director of the energy consulting firm RBJ Strategies, told POLITICO that “there’s only a handful of companies who have the capital resources to be there” in Venezuela. “They will be at the table Friday.”

“There are ton of other people who want to be at the table, a ton who wish they could be,” Brown added. “There’s a lot of interest and a lot of people talking a big game, but at the end of the day it’s going to take a shitload of money they may not have.”

The payoff from jumping in could be huge — Venezuela had one of the world’s most sophisticated economies before Chávez installed a politically repressive socialist government that drained it of resources and let its prized oil industry sink into decrepitude. But the risks remain just as big, including working in a country with no clear political path forward and an oil industry rife with corruption.

A Chevron spokesperson confirmed the company would attend Friday’s meeting. Spokespeople for Exxon, Repsol, Shell and Trafigura declined to comment. ConocoPhillips, Eni and Vitol did not respond to requests for comment.

Those companies have some of the strongest financial bases in the oil sector but also have endured the hard experience of working in Venezuela, and they are still measured in their enthusiasm for the task Trump wants them to undertake, people in the industry have told POLITICO. Some of the CEOs fear that Trump will use the meeting — and invite television cameras — to pressure them to make public commitments sooner than they would like.

The Friday meeting will likely function as a pulse check, said Mark Menezes, CEO of the U.S. Energy Association and Energy deputy secretary in Trump’s first term. He said independent U.S. producers that emerged in the domestic shale boom in the last 15 years might have the “appetite” and capital to jump in quickly. Some of those firms have experience buying up old assets and trying their hands.

But oil majors take a “much longer view” on “decadal” horizons, Menezes said. Their boards are still likely weighing the known risks against the opportunity: a vast amount of proven oil reserves of more than 300 billion barrels, estimated to be the world's largest.

“Getting an expression of interest would be the first thing” to come of the meeting, Menezes said. “Then to actually get a commitment, I think that would probably take a process.”

Questions abound on who will guarantee the companies’ security and property in a country still being run for the most part by the same people who took their equipment two decades ago, as well as who will pay them and in what currency. There’s also the question of how much information the White House is sharing with acting President Delcy Rodriguez’s interim government.

In one example, the industry is still uncertain whether the White House has even alerted Venezuelan officials that the administration has given Vitol and Trafigura licenses to sell the 50 million barrels of oil Trump said the country was “turning over” to the United States.

“The real question is if Venezuela is aware” of the new oil licenses, according to a person familiar with the effort to reach out to oil companies.

The Venezuelan state oil company, known as PdVSA, released a statement Wednesday saying it was negotiating with the United States on the sale of oil volumes.

American Petroleum Institute CEO Mike Sommers said security is a prerequisite for reentering Venezuela.

“We need security guarantees before significant investment,” he said Thursday on Fox News. “I think there will be tremendous interest if we can get the rule of law established and changes in policy and second if we can get security guarantees."

Another potential pitfall is that spending billions of dollars to pump out more oil in a market where there are plenty of other places to invest may not make a lot of business sense, said Simon Lack, energy infrastructure portfolio manager at asset management firm Catalyst Funds.

The U.S. benchmark oil price was around $57 a barrel Thursday, close to a five-year low — also limiting the economic upside of spending big in Venezuela.

“Overall, this doesn't seem that bullish for oil companies,” Lack said in a market commentary email. “The Administration's policy is to get prices lower, which is generally bad for them. US companies will be pressured to invest in Venezuela to increase production, furthering the White House goals but perhaps meaning they commit capital to expanding Venezuela on terms that are influenced by political pressure — i.e. non-economic.”

Brouillette said Venezuela’s daily peak production of 3.5 million per barrels, something the country last achieved decades ago, is not a game-changing prize in a market using more than 100 millions barrels each day. He said the companies will "evaluate this project relative to other projects they currently have on the books,” noting that drilling in neighboring Guyana — where Chevron and Exxon operate — is cheaper.

The administration is still exuding confidence that it will all work out, said one former administration official in contact with the White House.

“They will need to see certain steps being taken and reassurance. There's also the possibility of the U.S. government providing guarantees and financing in certain terms that become equivalent to political risk insurance, and the President could commit to that with covenants that a future president can't reverse,” this person said.

For companies willing to take the risk, the opportunities in Venezuela extend beyond drilling.

“Venezuela's electricity grid is in terrible shape so in addition to oil and gas development, there’s going to be a significant need for American power generation and support,” the former administration official said.

A team within the White House made up of staffers from the National Energy Dominance Council and the National Security Council is working on another high-priority issue for the administration: critical minerals.

“The mining and minerals team in the White House is fielding a lot of interest from various stakeholders, especially the investors who want to and help finance mining projects,” the person added.

Companies may follow the playbook of promising the White House they are interested in investing in Venezuela just to stay on Trump’s good side but ultimately not following through, said one business lobbyist familiar with the situation who was granted anonymity to speak frankly. That phenomenon — sometimes described as “Everyone Makes Promises And Never Actually Does Anything” — has become common enough during this administration that it has garnered an acronym, this person added.

“My impression is it’s EMPANADA all over again,” this person said.

James Bikales and Felicia Schwartz contributed to this report.