CARACAS, Venezuela – Venezuelan President Nicolas Maduro announced plans on Tuesday to authorize oil exploration in a disputed area around the Esequibo river, despite ongoing territorial disagreements with Guyana. The decision comes after a weekend referendum in which voters rejected the International Court of Justice’s jurisdiction over the disagreement and supported the creation of a new state in the contested territory.
Maduro has affirmed that the referendum is binding, but the ICJ recently issued a ruling prohibiting Venezuela from taking any action that alters the status quo in the oil-rich region. Nevertheless, Maduro stated that the state oil company PDVSA and state iron and steel maker CVG will establish divisions for the disputed region, with plans to grant operating licenses for oil, gas, and mineral exploration and exploitation in the Guayana Esequiba area.
In addition to proposing a law to create the new state, Maduro also announced a three-month deadline for companies currently operating in the region to vacate the area. This move follows Venezuela’s reactivation of its claim over the 160,000 square km territory, driven by the discovery of offshore oil and gas in the area. The maritime border between Venezuela and Guyana is also a point of contention.
It is worth noting that a consortium led by Exxon Mobil started oil production off Guyana’s coast in 2019 and began exports in 2020. Meanwhile, Guyana, currently producing approximately 400,000 barrels per day of oil and gas, has received bids for new blocks from local and foreign companies. Despite this, the exploration licenses for those areas have not been finalized.
Guyana’s government stated its commitment to remaining vigilant, citing Venezuela’s unpredictable leadership. Analysts have suggested that the referendum may have been Maduro’s attempt to gauge his government’s level of support ahead of the 2024 presidential election.
In conclusion, Maduro’s decision to authorize oil exploration in the disputed Esequibo region reflects ongoing tensions between Venezuela and Guyana. The referendum’s outcome has heightened uncertainties in the area, particularly regarding the potential impact on regional oil and gas operations.
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