ExxonMobil can evaluate seven areas in Venezuela under a preliminary, non-binding agreement with the government and state oil company PDVSA, four people close to the matter told Reuters. One of the sources said Exxon holds exclusive rights for one year to negotiate contract terms. Russia's stake in two of the projects remains an open question.
A preliminary agreement lets ExxonMobil evaluate seven areas for development in Venezuela, four people close to the matter said. The areas include undeveloped fields, mature areas and an exploration block. Exxon and PDVSA signed the memorandum of understanding on Monday in Caracas, in the presence of interim Venezuelan President Delcy Rodriguez.
Exclusive negotiating rights for one year
The pact is non-binding. Under it, Exxon has exclusive rights for one year to negotiate contract terms and view subsurface and other data for the fields, one of the sources said. Other foreign companies negotiated similar arrangements this year to enter the country's energy sector.
Exxon is evaluating a return to Petromonagas, previously called Cerro Negro, which is one of the few projects with an operational upgrader that turns extra-heavy crude into exportable grades. The company is also assessing three additional areas in the Orinoco, and two sources said it is negotiating exploration rights at a separate block.
Russia's stake complicates two projects
Russia's role is unresolved at Petromonagas and Petrovictoria. Rosneft acquired a 40% stake in Petromonagas after the project was expropriated from Exxon, and the stake moved in 2020 to Roszarubezhneft, a Russian state firm created to shield Moscow's overseas assets from US sanctions.
Russia's government has said publicly that the company remains a stakeholder in those two projects and others in the OPEC country. Exxon has not publicly disclosed its areas of interest in Venezuela and has not referred to Russia's stakes.
Exxon softens its stance on Venezuela
Exxon's tone has shifted this year. In January, CEO Darren Woods called Venezuela uninvestable during a White House meeting. Following an oil reform pushed by Rodriguez, Woods said on the third-quarter earnings call that progress had been made on fiscal and legal terms.
Exxon described the memorandum in a Monday statement as a first step, adding that any future investment would require stable policies and strong investment protections. US Energy Secretary Chris Wright said on social media this week: "tremendous progress in a remarkable short time."
Source: Investing.com
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