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Trump administration in talks about Chevron's operations in Venezuela: envoy

By Humeyra Pamuk and Timothy Gardner

By Humeyra Pamuk and Timothy Gardner

WASHINGTON (Reuters) - The Trump administration is in discussions about whether to renew a license for Chevron Corp's operations in Venezuela as Washington looks to increase pressure on its socialist leader, the U.S. special envoy to the South American country said.

U.S. Special Representative for Venezuela Elliott Abrams said in an interview on Monday that he would not talk about specific future activities on Chevron.

"But there are conversations taking place and at the appropriate moment OFAC will say whatever it needs to say," Abrams said about the Treasury Department's Office of Foreign Assets Control, which makes announcements on sanctions.

The Trump administration has been divided on whether to revoke California-based Chevron's ability to continue operations in Venezuela, home to the world's largest oil reserves and where the company has been active for about 100 years. It has renewed the license for Chevron and four other U.S.-based companies several times and the current one expires on April 22.

State Department officials, including Secretary of State Mike Pompeo, have wanted to keep Chevron operating in Venezuela to have a U.S. beachhead there and source of stability should President Nicolas Maduro be forced to step down.

White House officials on the National Security Council have been more aggressive, arguing that Chevron's presence in Venezuela is not helping in the push to remove Maduro. The United States supports opposition leader Juan Guaido.

Abrams found it unlikely that there could be other ways for Washington to halt Chevron's activities in Venezuela. "There are various reasons why Chevron might stop other than the revocation of the license but in terms of the U.S. government, I think that would be the only way," he said.

Some analysts have said that if Chevron were to leave Venezuela its assets could end up in the hands of Russia's state-led energy company Rosneft or other Russian interests. Abrams said Washington had ways to deal with that.

"The first question is whether Rosneft which portrays itself as just a business, just an oil company, would want to put more of its assets and activities in Venezuela, and that ought to be a business decision," Abrams said. "Let’s see first if it is a business decision. That is who makes the decision? The company or the government of Russia," Abrams said. "Obviously we have ways of responding if they do that."

Washington last week slapped sanctions on a trading unit of Rosneft that has emerged as a key intermediary for the sale of Venezuelan oil and President Donald Trump on Tuesday warned more actions will be taken.

Rosneft has accused Washington of double standards saying it allows U.S. companies to work in Venezuela.

Chevron says its Venezuelan crude exports last year represented about 2% of the country's total crude shipments and that its marketing activities are permitted under the license. It also said the proceeds go to maintenance of operations at joint ventures in Venezuela.

"Proceeds are not paid to PDVSA," said Chevron spokesman Ray Fohr. "Our focus continues to be on our base business operations and supporting the more than 8,800 people who work with us and their families."


(Reporting by Humeyra Pamuk and Timothy Gardner in Washington; additional reporting by Marianna Parraga in Mexico City)