Maria Machado: Venezuela could quintuple oil production under a democratic government

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HOUSTON — Venezuelan opposition leader María Corina Machado said her country could eventually quintuple its crude production with a transition to a democratic government and an extensive overhaul of its oil rules.

Machado laid out a detailed plan to oil executives gathered at the CERAWeek by S&P Global conference in Houston that would completely reform Venezuela’s oil sector, transforming it from a state-run enterprise to a “fully private” industry. The U.S. captured the country’s former leader Nicolás Maduro earlier this year and has hoped to boost production from its moribund oil fields.

Machado said her plan could raise the country’s oil production from the current roughly 1 million barrels a day to as much as 5 million barrels a day, higher than the country produced at its peak. But that effort must begin with free and fair elections and a transition to a democratically elected government, she said.

“We’re grateful for these early efforts that President Trump’s administration and [Energy] Secretary [Chris] Wright have done, and we recognize the importance in opening this new chapter for our country,” Machado said from the CERAWeek stage. “What comes next, though, must go further.”

Machado estimated it would require about $150 billion in investment over the next decade to restore Venezuela’s dilapidated oil industry and raise its production to those levels.

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Royalties would be capped at 20 percent, and international oil companies would fully control their production, with fiscal terms locked in when contracts are signed.

“You will own production right out of the wellhead,” she told the companies.
Machado touted Venezuela’s crude as a stable alternative as the war in Iran disrupts oil supplies from the Persian Gulf, noting her nation sits just five days away by ship from the United States.

The Trump administration has walked a political tightrope as it works with Venezuela’s acting leader, Delcy Rodríguez, to boost oil production while nudging the country toward democracy. It is unclear if and when it will hold free and fair elections, which Machado estimated would take at least nine months to organize.

Wright, who recently traveled to Venezuela, told the conference on Monday that he has had “constructive” interactions with Rodríguez’s administration. He praised the nation’s recent reforms to its landmark hydrocarbon law, but said further changes will be needed.

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