U.S. oil companies could be “up and running” in Venezuela’s oil sector within 18 months, U.S. President Donald Trump told NBC News days after U.S. forces extracted Nicolas Maduro out of the country holding the world’s largest proven oil reserves.
“A tremendous amount of money will have to be spent, and the oil companies will spend it, and then they’ll get reimbursed by us or through revenue,” President Trump told NBC News in an interview.
Regarding the 18-month timeline during which U.S. companies could begin boosting Venezuela’s oil production, the President said “I think we can do it in less time than that, but it’ll be a lot of money.”
Analysts have started to quantify how much money it would take to resurrect Venezuela’s industry. It’s quite a lot, and will take at least a decade, even if U.S. oil firms were to flock to the opportunity, they say.
The total investment over a decade could be upwards of $100 billion, according to various analyst estimates.
President Trump’s vision sounds like a great opportunity for the U.S. supermajors, of which only Chevron is currently authorized to operate in Venezuela and export the crude to the United States.
In reality, the mission to fix Venezuela’s dilapidated oil infrastructure after decades of mismanagement and corruption would be a real challenge, the political and security situation on the ground permitting.
Yet, President Trump will be meeting with oil industry executives this week to discuss the potential boost in Venezuelan oil production, Reuters has reported, citing unnamed sources.
The oil issue was top of the U.S. president’s agenda for Venezuela, as declared after the announcement of air strikes on Caracas and the capture of Maduro.
Reuters cited unnamed oil industry executives who, despite declarations made by President Trump, claimed that Exxon, ConocoPhilips, and Chevron had yet to discuss the future of Venezuela’s oil industry.
By Charles Kennedy for Oilprice.com
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