When news of the attack and capture of Venezuelan Nicolás Maduro by US forces broke earlier this month, Barry Blacklock’s phone started ringing.
The Calgarian lived in Venezuela for 17 years, where he became a permanent resident and worked in the energy sector before leaving in 2009.
“That night I was getting emails from friends in Canada and since then, 50, 60 different WhatsApp messages, emails and phone calls from people,” he said in a video call interview from Mexico.
He now helps coordinate a contingent of companies looking to invest and bring equipment to Venezuela, where there could be a huge wave of demand for their services in the years to come. He had organized a similar group in 2019, when it looked like there might be a regime change, but it never materialized.
“Clearly, a change is coming. We just don’t know what it is yet,” said Blacklock, an entrepreneur with more than 40 years of experience in the international oil and gas sector.
Alberta has many oil and corporate workers with experience all over the world. The recent intervention in Venezuela, along with U.S. President Donald Trump’s stated plan to rejuvenate the country’s oil industry, is generating cautious enthusiasm among some in Alberta’s energy sector. But a host of challenges remain, including an unstable government and uncertainty over the level of U.S. involvement.
A potential opportunity
Venezuela has the largest proven crude reserves in the world, estimated at 303 billion barrels. But its oil industry has been deprived of new investment, equipment and technology for two decades, due to corruption, hostility and state control.
“A lot of oil fields have been neglected. They’re not producing,” Blacklock said. “The equipment, the wellheads, the pumps, a lot of the equipment on the surface has been stolen or just left to deteriorate, so it’s worthless. It’s all going to have to be replaced.”
For foreign companies, there is profit potential. This is especially true for those in Alberta, many of whom work with heavy oil similar to that found in Venezuela.
“In Canada, we have great capacity and great potential to offer Venezuela by bringing all these technologies,” said Amit Mankekar, who operates consulting firms in Canada and Colombia, “that have advanced significantly in the last few decades that Venezuela has not.”
Adam Waterous, executive chairman of Strathcona Resources, told Reuters this week he would quickly assemble a technical team from his company, Canada’s fifth-largest oil producer, to travel to Venezuela if asked.
Healthy hesitation
With any level of enthusiasm comes a healthy dose of hesitation about all the challenges of working in Venezuela.
“What will the taxes be? What will the royalties be? Will it be fair and comparable to other jurisdictions around the world?” Blacklock said.
“Will Canadians be safe if they go to work there?”
Meanwhile, U.S. sanctions persist, and it’s unclear how open the U.S. and Venezuelan governments will be in allowing Canadian companies to operate in the country — or how long the U.S. will be involved. Reconstruction efforts would likely take several years and billions of dollars, experts estimate, given the current state of infrastructure.
The Trump administration takes control of Venezuela’s oil industry after the impeachment of President Nicolas Maduro. Andrew Chang analyzes the significant obstacles facing the United States, as well as President Donald Trump’s allegations of “stolen” oil, and questions whether the operation is worth it.
Trump hosted nearly 20 executives from major oil companies at the White House last week and demanded at least $100 billion in oil spending for Venezuela. No Canadian companies were present.
The response was lukewarm, with many executives expressing caution.
“Our assets have been seized there twice, and so you can imagine that going back a third time would require some pretty significant changes from what we’ve seen historically and where the state is currently,” ExxonMobil CEO Darren Woods said at the White House.
“Today, it’s not investable.”
“A family you never saw again”
Any foreign business, including those in the United States, will need to be assured of government stability, legal protections and certainty that contracts will be honored, industry executives say.
It will also be necessary to ensure the safety of the workforce.
“Venezuela has no laws that could be respected by anyone,” said Pedro Pereira-Almao, a former professor at the University of Calgary, who describes the country as a failed nation.
“How many Venezuelans are going to volunteer to immediately go back there and start working in a hostile environment?”
It’s a question he thinks about himself. Pereira-Almao grew up in Venezuela and spent 14 years at Petróleos de Venezuela, SA, the state-owned oil and gas company, including as director of heavy oil processing.
After Hugo Chávez came to power in 1999, he attacked the oil industry by nationalizing the assets of some foreign companies and laying off thousands of state-owned company workers – mainly executives and technical experts – including Pereira-Almao in 2003.
“It was a tragedy for everyone,” he said, moved as he described this period of his life.
“It’s hard to see people who worked with you who were killed,” he said. “Friends and family you never saw again.”
Looking to the future
Before anyone travels to Venezuela, they must also have political and economic support from the United States, Pereira-Almao said.
He is still in touch with former colleagues who he could see playing a role in Venezuela’s energy industry, if the situation in the country improves.
“Before that, I won’t go,” he said. “Now I am more sure that in a year or two we will be able to go to Venezuela and make our contribution.”
He would not settle in Venezuela permanently, he said, but could collaborate with others.
US President Donald Trump has urged top oil executives to act quickly to develop Venezuela’s vast oil reserves. But few seem ready to intervene with both feet in the days following the capture of Venezuelan President Nicolas Maduro by American forces.
“Do we need technology? What type of technology? Who are the best suppliers?” he said, listing many other ways he could help as a chemical engineer.
Any increase in production from Venezuela, once one of the world’s largest oil producers, would likely compete with heavy oil exported from western Canada, particularly to refineries on the U.S. Gulf Coast.
Over the past week, Canadian heavy oil prices have traded at a greater discount to North American prices because of this outlook, even though most of Alberta’s exports go to the U.S. Midwest, which experts say would be less affected.
This reality is not lost on Blacklock, who admits there are mixed feelings about business opportunities for Alberta energy companies in Venezuela.
“Whatever happens when Venezuelan oil starts hitting the market, it will have an impact on the Canadian industry,” he said.
“This could very well cause it to lose market share.”
