December 5, 2023 [World Oil]- ExxonMobil Corp. CEO Darren Woods said the Texas energy giant is focusing on producing oil in Guyana as efficiently as possible to help the South American country in its border dispute with Venezuela.
I’m not sure the press has captured the true intensity of the situation there, but we’re keeping an eye on it,” Woods said in an interview at the COP28 climate summit in Dubai. “We can do what we can do, which is making sure that we’re helping the government of Guyana by producing the resources efficiently.”
Venezuelans on Sunday voted on referendum questions over whether to claim a disputed border area known as the Essequibo that’s currently controlled by neighboring Guyana. Elvis Amoroso, head of Venezuela’s electoral body, said preliminary results show an “overwhelming victory” of positive answers as the government uses the issue to stoke nationalism among the electorate ahead of presidential elections in 2024.
Guyana and Venezuela have been disputing their boundary since the late 1800s, when an international arbitration panel award the territory to Britain. In 1962, Venezuela said the decision was invalid and has periodically demanded the area be handed over. Guyana achieved independence from Britain in 1966.
The dispute has gained renewed fervor since Exxon discovered oil off Guyana’s coast in 2015 and quickly turned the country into one of the fastest-growing producers of crude. Separately, then-president Hugo Chavez nationalized Exxon’s operations in Venezuela in 2007.
“I think there’s a lot of things happening in Venezuela from a political standpoint,” Woods said.
Here’s more from the interview with Woods:
Is Exxon financially assisting Guyana’s government in the dispute?
“No, we’re not. We’re limiting our role to the area of our expertise, which is to basically help them responsibly develop their resources.”
Does Exxon expect any regulatory pushback on its roughly $60 billion acquisition of Pioneer Natural Resources Co.?
“We’re in the early stages of that. I think, if you look at the merits of that transaction, it shouldn’t trip any regulatory hurdles or clearance hurdles. The two of us together represent less than 15% of production coming out of the Permian. We represent less than 5% of the production in the US and less than 3% for the world. From a fair-trade standpoint or a fair competition standpoint, it doesn’t reach any thresholds that would be a concern.”
How are relations with the Biden administration?
“I spend more time engaging with this White House than I did with the White House before that. So I think there’s a genuine effort by the Biden administration to strike the right balance: To focus and drive emission reductions and improve greenhouse gas emissions, but at the same time, a recognition of the important role oil and gas plays — the need to continue to provide affordable, reliable energy supply.”
How worried are you that the Inflation Reduction Act may be pulled back after the next election?
“Any time you build a business based on government support there’s always that risk. But our view is, fundamentally, emissions need to be reduced. And so there may be short term pluses and minuses, but ultimately, we’re staying focused on long-term objectives. Society has got to find a way to reduce emissions. We think the approach that we’re taking is sound under any regime. It’ll be competitive under any regime.”
Why is Exxon joining initiatives to encourage national oil companies to reduce emissions?
“It’s important that we get as much of the industry committed to raising the bar. We have a philosophy that we’re working to in the company to be the most responsible operator. So, for as long as there’s a demand for oil and gas, you want the most responsible companies producing that.”
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