(News Bulletin 247) – The oil group announced that it had obtained a specific license from the American Ofac, which will allow it to continue its operations in Venezuela.

The oil sector is often linked to geopolitics. A fortiori when an operator operates in a country like Venezuela, subject to American sanctions.

Maurel & Prom was, however, able to resume its activities in Venezuela last November, following a succession of political events. On October 17, the Venezuelan government reached an agreement with the opposition with a view to the presidential election next July.

The next day, a general license was issued by the American Office for Foreign Assets Control (Ofac). This license authorizes American and foreign groups to carry out transactions and activities related to the production, capture, sale or export of oil or gas in Venezuela, involving entities of the Venezuelan government, such as PDVSA (Petroleos of Venezuela).

Maurel & Prom indirectly holds 40% of a mixed company called Petroregional del Lago, the remaining 60% of which belongs to PDVSA. This mixed company operates the Uraneta Oesta oil field in Lake Maracaibo.

>> Access our exclusive graphic analyses, and gain insight into the Trading Portfolio

A new license

The French group had thus entered into agreements in November with PDVSA, agreements which provided in particular for an “increased involvement of Maurel & Prom in the operations and purchases of the mixed company, in particular via the secondment of new employees to key positions”. This agreement also defined the terms of repayment of a debt of 914 million dollars owed by PDVSA to a subsidiary of the French company.

However, the United States general license granted in October expired on April 18. “Whatever the fate reserved” for this license, “Maurel and Prom hopes and expects to be able to continue its activities in the country according to the agreements signed with PDVSA in November 2023, within the framework of a new license, either general be specific, this situation should be clarified imminently” assured Maurel & Prom on April 18.

If applicable this Monday. Maurel & Prom announced that the American Ofac had granted it a specific license on May 3. This specific license “allows American entities and banks to collaborate with Maurel & Prom within the framework of its activities in Venezuela and, therefore, the French group will be able to continue to operate in accordance with all the agreements signed with PDVSA on November 7, 2023 “, explains the company.

“The current expiration date of the specific license is May 31, 2026, and M&P expects it to be renewed,” Maurel & Prom continued.

This announcement was well received on the Paris Stock Exchange where Maurel & Prom gained 7.8% around 3:20 p.m.

In its November presentation, Maurel & Prom explained that the production potential of its joint company in Venezuela amounted to 16,500 barrels per day. To give an order of comparison, Maurel & Prom’s production (in proportion to its shares in its various projects) amounted to 29,500 barrels of oil equivalent per day in 2023.

In the first quarter of 2024 alone, Venezuela represented 5,353 equivalent barrels per day in the group’s share for the French group, or 14% of the total.

In addition, Maurel & Prom had indicated that it expected to receive $70 million in dividends this year via its participation in its Venezuelan joint venture. The group also indicated in November that it intended to increase the production potential of the Urdaneta Oeste field to 25,000 barrels per day by the end of 2024 “thanks to targeted interventions on wells and surface repairs and optimizations.” .