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License extension to Chevron preserves assets and operations in Venezuela

The measures taken since 2015 by the government of the United States of America, since the administration of Barack Obama, and currently under Donald Trump, in response to the Venezuelan situation have modified the economic, commercial and financial sphere between the two countries.

In August 2019, the U.S. administration underwrote new Executive Order against the Venezuelan governmentThe resolution was signed under number 13,884, which specifies the scope of the blockade of assets of the South American government in the territory of the United States of America.

The legal instrument includes as object of the sanction the State and government of Venezuela, political subdivisions (federal entities and municipalities), agencies, the Central Bank of Venezuela and Petróleos de Venezuela, as well as any entity in which the Venezuelan government has ownership or an interest equivalent to 50%.

The license to Chevron

All of these sanctions have imposed new economic and commercial actions This is one of the reasons why the U.S. oil company Chevron Corporation, with strategic operations on Venezuelan soil, has had to renew its license twice to continue operating since January of this year.

For this reason, the U.S. Treasury Department recently approved the renewal for three months of the license granted to the aforementioned American multinational in spite of all the debate that has arisen around it. Some officials of the Trump administration refused to give course to the measure, alleging that the generation of economic resources after the exploitation of hydrocarbons is an advantage to keep the government of Nicolás Maduro on its feet. However, for the majority that decided to approve it, Chevron's operations mean an asset in the middle of the conflict and a support to the human team that works in its facilities in Venezuela.

The license does not authorize transactions related to shipments of heavy oil conversion diluents.Chevron is the only U.S. oil and gas company operating in Venezuela as a partner, but allows the operations of service companies such as Halliburton, Schlumberger, Baker Hughes and Weatherford International for the next three months. At present, Chevron is the only American exploitation and production company that maintains activities in Venezuela as a partner after the implementation of the partner participation scheme through joint ventures. Chevron currently has an interest in the joint ventures Petropiar, Petroboscan and Petroindependencia.

At Alan Aldana & Abogados, we have a specialized team and strategic international alliances to provide advice and consultations required by companies in the energy and services area that wish to operate in Venezuela, either through the analysis of the general licenses granted by the American administration or by obtaining specific licenses.