Oil Giant Returns to Venezuela! ExxonMobil (XOM.US) Reportedly Obtains Rights to Assess 7 Regions, One-Year Exclusive Negotiation Window Opens

According to sources familiar with the matter, Zhitong Finance APP reports that ExxonMobil (XOM.US) has reached a preliminary agreement with the Venezuelan government and the state oil company PDVSA. The American oil giant has been granted permission to assess the development potential of seven blocks, covering undeveloped oil fields, mature oil fields, and one exploration block.

This memorandum of understanding was signed in Caracas on Monday, witnessed by Venezuelan Acting President Delcy Rodríguez, as sources disclosed details of the agreement.

If ExxonMobil ultimately secures this portfolio of assets, it will mark a favorable return to the Venezuelan market, especially given the potential synergy with its neighboring operations in Guyana and Trinidad and Tobago, allowing the company to dilute operating costs and improve efficiency. ExxonMobil operates the highly productive Stabroek Block consortium in Guyana, and also holds exclusive interests in a large deepwater exploration area in Trinidad and Tobago.

One source noted that the preliminary agreement with Venezuela is not legally binding. ExxonMobil will have exclusive rights for one year to negotiate contract terms and review geological and other technical data pertaining to the oil fields. Earlier this year, other foreign companies have entered Venezuela’s energy sector through similar arrangements.

Apart from a statement issued on Monday calling the memorandum a “significant first step,” ExxonMobil declined to comment further. The Venezuelan Ministry of Petroleum and PDVSA have not yet responded to interview requests.

Earlier this year, Venezuela offered ExxonMobil another set of blocks, which the company declined. Subsequently, negotiations shifted focus to several heavy oil blocks in Venezuela's largest oil-producing region—the Orinoco Belt—including an area that was ExxonMobil’s operational zone before its assets were expropriated in 2007.

According to four sources who requested anonymity, ExxonMobil is evaluating a return to the Petromonagas project (formerly Cerro Negro). This project is one of the few assets equipped with operational upgrading facilities, enabling the conversion of extra-heavy oil into exportable crude grades. The company is also assessing three other blocks in the Orinoco Belt, which include both producing and undeveloped fields. Due to the confidentiality of the agreement details, these sources requested anonymity.

Two sources added that ExxonMobil is separately negotiating exploration rights for another exploration block.

The ongoing negotiations involve the Petromonagas and Petrovictoria projects. It remains uncertain whether Russia will continue its participation.

Rosneft acquired a 40% stake in Petromonagas after ExxonMobil’s assets were expropriated; in 2020, this stake was transferred to the Russian state-owned company Roszarubezhneft, which was established to help Moscow’s overseas assets avoid U.S. sanctions.

The Russian government has publicly stated that Russia remains a stakeholder in these two projects and in other oil and gas ventures within this OPEC member country. Venezuelan Petroleum Minister Pedro Tellechea has also stated this year that the Venezuelan government will fully honor agreements made with Russia and China, and that joint ventures with Russian and Chinese participation will continue to operate.

ExxonMobil has not publicly disclosed which blocks in Venezuela it is interested in, nor has it mentioned details regarding Russia’s shareholdings.

Key Stakes

In its statement on Monday, ExxonMobil said: “This memorandum of understanding is a significant first step, but any future investment requires stable policies, clear regulatory rules, strong investment protection, and competitive returns.”

In January this year, shortly after the U.S. ousted then-President Nicolás Maduro, ExxonMobil CEO Darren Woods described Venezuela as “not yet investable” during a White House meeting, stating that significant additional safeguards were needed to protect long-term investments and avoid future expropriation of assets.

After Rodríguez advanced oil sector reforms this year and loosened restrictions on foreign investment, Woods’ posture became more accommodating. On the company’s Q3 earnings call, he noted progress on fiscal and legal terms.

This week, U.S. Energy Secretary Chris Wright commented on social media that ExxonMobil’s preliminary agreement represents “huge progress in a very short period of time.”