Chevron CEO Mike Wirth said on Friday the U.S. oil major can process an additional 100,000 barrels per day of Venezuelan crude at its refineries. “We’ve been bringing about 50,000 barrels a day, give or take, into our Pascagoula, Mississippi, refinery on the Gulf Coast. We can take another 100,000 barrels a day into our system, both at Pascagoula and on the West Coast, where we’ve got coking capacity at El Segundo,” Wirth said during a fourth-quarter conference call with analysts.
“So I think you should expect to see us, assuming it competes against alternatives, to be running more Venezuelan crude in our system over time.”
When asked about the amount of Venezuelan crude U.S. Gulf Coast refiners could absorb before impacting current price differentials with lighter crude or disrupting the flow of heavy crude from Canada, Wirth said a new equilibrium will be established.
“As you bring more of these barrels in… they’re going to redistribute around the world,” he said.
Chevron, the only U.S. oil major operating in Venezuela, currently produces around 250,000 barrels per day in the South American country and sees potential to increase output by an incremental 50% over the next 18 to 24 months provided there are additional authorizations from the U.S. government. For a longer-term outlook, however, Wirth said the company needs to see stability in the country. “We need to have confidence in the fiscal regime,” Wirth said, adding that the company is in the process of reviewing a hydrocarbons law reform that was passed by Venezuela’s National Assembly on Thursday.
“With the right changes, we certainly could see our operations and footprint expand in Venezuela, and we’re working with the U.S. government and the Venezuelan government to try and create circumstances that would enable that,” he said.
(Reporting by Vallari Srivastava in Bengaluru and Sheila Dang in Houston; Editing by Leroy Leo, Nathan Crooks and Matthew Lewis)