With 30 years of Wall Street experience, Co-Editor-in-Chief Todd Campbell explains why ConocoPhillips’ position on the Venezuela oil rig is a reality check for the energy sector.
Energy companies have felt significant pressure over the past year as OPEC production has increased, leading West Texas crude oil prices fell to $62 a barrelbelow Permian Basin production costs. As a result, many believe the next big play will be resource-rich Venezuelawhich holds world-leading oil reserves 303 billion barrels.
The allure of unlocking so much black gold should eat up oil, yet decades of broken promises mean CEOs are reluctant to commit the billions of dollars needed to revamp Venezuela’s aging infrastructure, including Ryan Lance, CEO of ConocoPhillips.
Quick fact: Venezuela’s peak production totaled 3.75 millionbarrels per day. In 2025, it adds up to approx 800,000from a minimum of approx 350,000 in 2020.
On ConocoPhillips’ ( COP ) recent earnings call, Lance addressed the issue head-on, resetting expectations for a rapid acceleration in his company.
“We’re pretty focused on what we’ve talked about in the past, and that’s the focus on Citgo’s recovery path in Venezuela,” Lance said. “That’s our first priority right now.”
Like many oil companies, ConocoPhillips came under fire as Venezuela nationalized its oil reserves, and confiscations left the company owing at least 10 billion dollarsincluding interest, following a 2019 ruling by the International Court of Arbitration.
U.S. Energy Information Administration, International Energy Statistics and the Short-Term Energy Outlook ·U.S. Energy Information Administration, International Energy Statistics and the Short-Term Energy Outlook
Venezuela owes ConocoPhillips more than anyone else for its past operations there because it refused to accept a minority stake in its assets when former President Hugo Chavez seized them in 2007.
More oil and gas:
ExxonMobil similarly declined the deal, while Chevron (CVX) has accepted these terms and is seen to benefit the most from the capture and removal of Maduro and the future oil rig in Venezuela.
Petrified: Extra Heavy Crude Oil Project in the Orinoco Belt. More than $2.4 billion was spent to build it, with an estimated daily production of 120,000 barrels, according to Offshore Technology.
Hammock: 160,000 acre extra heavy crude oil project in the Orinoco Belt. Project costs totaled $3.8 billion, with production estimated at 190,000 barrels per day. ConocoPhillips had a 40% stake, according to Offshore Technology.
Corocoro: A large offshore light oil development project in the Gulf of Paria was discovered in early 1999 and is estimated to contain 500 million barrels of oil reserves. ConocoPhillips had a 32.5% share, according to the World Ports Directory.
Given the size of the projects and the money owed, ConocoPhillips’ reluctance to throw good money after bad money is understandable.
On the company’s earnings call, Ryan outlined three major changes that need to happen to pave the way for participation in Venezuela:
Security needs to be improved.
Constructive relations with local authorities must be strengthened and “local people who really want American companies there.”
Sustainable policies: “You need sustainability both in Venezuela and clearly here on the U.S. side.”
So far, assurances from the White House addressing those requests have been lukewarm, despite calling for up to $100 billion in investment to address years of underinvestment in Venezuela.
President Donald Trump has hinted that the US military would provide security, but signed Executive Order 14373 in January, effectively preventing oil companies from recovering funds from oil revenues held in US accounts, including some money held in Qatar.
One way ConocoPhillips has tried to recoup the billions it owes Venezuela is by auctioning off an oil giant. CITGOan American subsidiary of Venezuela’s national oil company, PDVSA.
Quick fact: 2007 captures cost ConocoPhillips 16 million BOE since 2007 Venezuelan production and 1.089 trillion BOE of reserves.
Last November, a court-appointed officer recommended that CITGO be sold for 5.9 billion dollars to Amber Energy (an affiliate of Elliott Investment Management). ConocoPhillips is a priority claim holder; however, total claims exceed 21 billion dollarsaccording to EnergyNow, so any money received from the sale will be far less than what they are owed.
As I previously wrote, unlike ConocoPhillips, Chevron continued to operate in Venezuela as a minority owner and is best positioned to capitalize on the exploitation of the country’s vast reserves.
It currently participates in a number of valuable assets, and the removal of restrictions should allow it to quickly return to pre-existing production levels.
Petroboscan: A share of 39.2% in Boscan Field
Petroindependiente, SA: 25.2% interest in the LL-652 field at Lake Maracaibo
Petropiar, SA: 30% interest in the Huyapari field in the heavy crude dominant Orinoco belt
Petroindependencia, SA.: 34% interest in the Carabobo 3 Project in the Carabobo area of the Orinoco Belt (extra heavy crude oil)
Iran: 60% offshore interest in the Loran field Source: Chevron
Chevron used to produce more than 200,000 barrels a day in Venezuela, but that figure has fallen below 100,000 as the US imposed export restrictions.
“Chevron has been in Venezuela for over a century,” Chevron CEO Michael Wirth said in January. “We see the potential to further increase production volumes by up to 50% over the next 18 to 24 months.”
Related: 147-Year-Old Oil Giant Just Raised Dividends 4% in 2026
This story was originally published by TheStreet on February 8, 2026, where it first appeared in the Investing section. Add TheStreet as a favorite source by clicking here.
