Debts owed by Venezuela conocophilips and exxon mobil Energy Secretary Chris Wright told CNBC on Wednesday that these are not immediate priorities for the Trump administration following the overthrow of President Nicolas Maduro.
“The huge debts Conoco and Exxon have are very real and will need to be repaid in the future,” Wright told CNBC’s Brian Sullivan. “But it’s a long-term problem, not a short-term problem.”
Conoco and Exxon filed arbitration lawsuits against Venezuela after former President Hugo Chávez nationalized the oil industry in 2007. Venezuela owes Conoco about $10 billion and Exxon about $2 billion, according to a JPMorgan memo issued Monday.
Wright said the Trump administration’s immediate priority is stabilizing Venezuela.
“What we need to do with the proceeds from these oil sales is to stabilize the Venezuelan economy, stop the collapse of the Bolivarian Union, and prevent Venezuela from becoming a failed state,” the energy secretary said.
After Chavez’s nationalization, Conoco and Exxon withdrew from Venezuela. chevron The company remains the only U.S. oil major operating in the country through a special license issued by the Trump administration.
Wright said it will take time for U.S. oil majors to invest the billions of dollars needed to rebuild Venezuela’s energy infrastructure.
“If you go out of the country with Exxon or Conoco, you can come back with normal commercial business conditions, the rule of law and some security. It’s going to take time,” he said.
He said the Trump administration would work with Chevron on “incremental adjustments and changes” that would allow for increased production.
Wright said earlier at Goldman Sachs’ annual energy conference in Miami that Venezuela’s production could increase by hundreds of thousands of barrels a day in the short to medium term.
The Energy Secretary said the United States would control Venezuela’s oil sales indefinitely.
“We’re going to put the oil coming out of Venezuela on the market, initially by backing up our oil reserves and then indefinitely, going forward, we’re going to sell the oil coming out of Venezuela into the market,” Wright said at the Goldman conference.
“We need that influence and control of oil sales to drive the changes that absolutely must happen in Venezuela,” the Energy Secretary said.
Trump is scheduled to meet with oil company executives at the White House on Friday, a source told CNBC’s Sullivan. The CEOs of ExxonMobil and ConocoPhillips, as well as representatives from Chevron, will also attend the meeting.
