CERAWEEK: Machado pitches oil industry on 5 million b/d Venezuela potential

Venezuela has the potential to increase crude production to 5 million b/d if a democratic transition leads to sustained legal overhauls and long-term foreign investment, Venezuela opposition leader and 2025 Nobel Peace Prize winner Maria Corina Machado said March 24.

In a speech at CERAWeek by S&P Global Energy in Houston, Machado said reaching that potential would require $150 billion in long-term investment into the South American country's industry -- following a democratic transition and sweeping legal changes.

Citing Venezuela's 300 billion barrels of proven oil reserves, she told the global energy conference the investments represented a $1.7 trillion opportunity.

PDVSA, Venezuela's state-owned oil company, produced 1.062 million b/d in February, according to Ministry of Hydrocarbons data.

This was "a fraction of what you will achieve again with the right investment environment," Machado told the audience. "This is the type of long-cycle, large-scale commitment that the companies in this room are going to make when the right conditions are in place."

Venezuela's oil industry produced 3 million b/d in 2008. Production has steadily declined since, amid a lack of investment in the country's heavy crude infrastructure and widespread allegations of corruption under former President Nicolás Maduro.

Machado laid out a vision of a more open, corruption-free Venezuelan oil industry, one built on significant changes to the country's legal system. She said PDVSA would initially shrink before Venezuela's government reduced its role in oil operations to a fully private model.

She proposed that oil and gas companies would receive 25-year contracts with 20% royalties, under which producers would own "production right out of the wellhead and be able to book the reserves." Property rights would be backed by international arbitration and enforceable legal guarantees, she said.

"We all know that right now, Venezuela carries a very high premium risk, close to 25% net rates," she said. "At these levels, most long-term projects simply do not make sense. We will bring this down to a level where investment is no longer a choice."

Political path

Machado praised progress made since the Jan. 3 US operation to capture Maduro, under what US Energy Secretary Chris Wright has referred to as an "interim government," but insisted "what comes next must come further."

That government, led by former Maduro Vice President Delcy Rodriguez, has earned the consistent praise of US President Donald Trump as the US has taken a role in marketing Venezuelan crude supply. In January, Trump said Machado was "not respected" in the country.

On a separate CERAWeek panel, Columbia University Global Energy Policy senior research scholar Luisa Palacio said the types of changes Machado promised would require a post-electon remaking of Venezuela's institutions.

"To have a good investment outlook on Venezuela, progress towards institutionalization has to be self-sustaining and self-reinforcing," she said. "It cannot just be externally driven. We're not going to be in that place until there's a transition."

Former PDVSA executive director of corporate planning Luis Pacheco Rodriguez said the path to a democratic transition remained muddled.

"We're not as close as we would like," he said. "Jan. 3 triggered a large expectation that has not been fulfilled as of today, for whatever reasons."

Machado won a combined opposition primary prior to the 2024 Venezuelan presidential election. When she was barred from running in the general election, her successor on the ticket, Edmundo González Urrutia, was widely regarded by international observers as the winner. Maduro claimed victory and remained in power.

At a CERAWeek event on March 23, Wright reiterated Venezuela would eventually undergo a democratic transition. The Trump administration has not laid out a timeline for elections. Machado said a new round of elections was coming "soon."

"We're already working on that," she said. "It takes at least nine months, 40 weeks, from a technical perspective to have perfect, free and fair elections."

But they will take place," she continued. "When they do, you will see the awakening of a country that will turn into a beacon of hope and wealth creation for this hemisphere -- and we want you to be part of it."