Chevron CEO calls for further Venezuela oil reforms

Chevron Corporation is reporting tangible progress in Venezuela as its crude production continues to climb, though further legislative adjustments are necessary to foster a stable environment for large-scale investment. Speaking at the CERAWeek by S&P Global conference in Houston, CEO Mike Wirth highlighted that while the operational landscape is improving, the legal framework requires additional refinement.

Theres still things that need to happen to encourage investment at the scale that people would like to see

The energy sector in the South American nation has become a focal point for the United States following political changes earlier this year. American officials, including Energy Secretary Chris Wright, have visited the country to support efforts to revitalize an industry that has endured decades of stagnation. Wirth emphasized that establishing access to international arbitration is a priority for potential investors.

While a January reform to the hydrocarbons law granted foreign companies greater autonomy—allowing them to manage oilfields and retain proceeds from crude sales—Wirth noted that the current fiscal terms remain somewhat vague. He suggested that the existing law allows for too much administrative discretion, which can lead to uncertainty.

At one end of the range we have investments that look attractive, at another of the range you have investments that probably wouldnt, so theres discretion and some ambiguity or uncertainty that still exists in the law that I think you can tighten up

Although the Venezuelan National Assembly previously indicated that specific legislation for oil taxation would follow the January reforms, the legislative body has since shifted its focus to other areas, such as mining. This shift has delayed the implementation of specialized tax and royalty structures that many joint-venture partners believe are necessary for new greenfield projects. Many industry participants are calling for the local law to align with international standards, specifically those found in U.S. Treasury licenses that mandate dispute resolution through international courts.

Currently, the administration of Delcy Rodriguez has shown limited interest in pursuing further amendments to the hydrocarbons law. Despite these legislative hurdles, Chevron remains the most prominent international partner for the state-owned PDVSA. The company’s four joint ventures currently produce approximately 250,000 barrels per day, representing about 25% of the country’s total crude output.