ExxonMobil Signs Non-Binding Deal With Venezuela and PDVSA to Study Oil Opportunities

The agreement does not commit Exxon to invest. The company did not say which projects or oil areas it will study. According to Reuters, Exxon would still need a final contract, such as a joint venture or a production-sharing agreement, before it could take part in exploration or production. Exxon called the memorandum "a meaningful first step" and said any future investment would depend on stable policies, clear regulations and competitive returns.

Those conditions point to the main risk for any return. Exxon left Venezuela in 2007, when the government of the late President Hugo Chavez expropriated its assets. Reuters said a renewed role for Exxon would be a win for President Donald Trump, who has pushed to rebuild Venezuela's energy sector with US companies at the front.

The talks have been public since September. On September 16, the Wall Street Journal reported, citing people familiar with the matter, that Exxon was close to a preliminary deal with PDVSA to explore several developed and undeveloped fields. The Journal said those fields together hold about 50 billion barrels of oil. It also reported that a memorandum could be signed that month, and that talks were expected to continue at the G-20 Energy Abundance Ministerial in Houston that week. Monday's signing came about seven weeks after that timetable.

Exxon is not the only US producer to sign up. Continental Resources signed its own preliminary agreement with PDVSA in September.

The memorandum leaves the commercial questions open: which fields, what ownership share, and what legal protections would cover Exxon's capital this time. Exxon has given no timetable for moving from the memorandum to a binding contract, and it has not said whether any of its former Venezuelan assets are part of the evaluation.