Exxon signs preliminary agreement with Venezuela to assess oil opportunities
XOM•ExxonMobil signed a non-binding memorandum of understanding with Venezuela’s state oil company PDVSA to assess upstream oil opportunities, without committing to a specific project. Any investment would require stable policies, clear regulations, strong protections and competitive returns, and a final contract.
1. Non-binding agreement
ExxonMobil said it signed a memorandum of understanding with PDVSA to assess upstream oil opportunities in Venezuela. The agreement does not commit Exxon to a specific project, and a final joint-venture or production-sharing contract would be required before it could participate in exploration or production.
2. Conditions for investment
Exxon said any future investment would require stable policies, clear regulations, strong investment protections and competitive returns. The company did not specify which projects or oil areas it is evaluating. Interim President Delcy Rodriguez welcomed Exxon and said she hoped the memorandum would lead to concrete agreements.
3. Unresolved arbitration award
Before its assets were expropriated, Exxon held a 41.67% stake in the Cerro Negro heavy crude project, now known as Petromonagas, and a 50% interest in the La Ceiba project. In 2014, the World Bank’s International Centre for Settlement of Investment Disputes awarded Exxon $1.6 billion plus interest; Venezuela has challenged the award, and the dispute remains unresolved.
