How did U.S. Treasury licences issued to Chevron in 2022 define permitted transactions and constraints on PDVSA?
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Executive summary
The Treasury Department’s November 26, 2022 General License 41 (GL 41) carved out a narrow, conditional permission for Chevron to operate its pre-existing joint ventures with Petróleos de Venezuela, S.A. (PdVSA) while explicitly limiting transfers of value to PdVSA and barring expansion beyond existing fields; OFAC described the license as authorizing “transactions ordinarily incident and necessary” to operate and manage Chevron’s JVs but also listed explicit prohibitions such as dividend payments to PdVSA and exports other than to the United States [1] [2]. The license was framed as a tightly circumscribed commercial exception within broader U.S. sanctions that still restrict new financing, equity, and long-term debt dealings with PdVSA [3] [4].
1. GL 41’s core allowance: operations and management only
GL 41 authorized only those transactions “ordinarily incident and necessary” to the operation and management of Chevron’s joint ventures in Venezuela that involved PdVSA or entities 50% or more owned by PdVSA, meaning routine production, maintenance, and similar activities at existing JV projects were permitted under the license’s narrow scope [1] [5]. OFAC’s public materials and legal summaries emphasize that GL 41 did not create a broad waiver of sanctions but rather a targeted permission for Chevron to resume limited extraction operations at its pre‑existing JV sites [5] [4].
2. Explicit prohibitions on transferring value to PdVSA
The license explicitly forbade the payment of dividends, including dividends in kind, to PdVSA or entities where PdVSA holds at least 50% ownership, and it barred sales of petroleum produced by the Chevron JVs for export to jurisdictions other than the United States, provisions designed to prevent revenues from flowing directly to the Venezuelan state under sanctions [2] [1]. Treasury and contemporary coverage highlighted that these constraints were intended to allow production without materially benefiting the Maduro government, and press and legal alerts noted the license’s express aim to prevent PdVSA from receiving profits from Chevron’s sales [6] [7].
3. Financial and structural constraints under wider sanctions
GL 41 operated against a backdrop of Executive Order restrictions that continue to prohibit certain debt and equity transactions with PdVSA—most notably bans on dealing in PdVSA debt or new equity issued after specified dates and limits on purchases of certain securities with maturities beyond short windows—so the GL did not relax those broader prohibitions on financing or capital transfers to PdVSA [3] [4]. Analysts and congressional summaries noted that GL 41’s permissions were therefore functionally limited to operating activity and did not allow Chevron to engage in long‑term financing or structural investment that would contravene existing EO provisions [8] [9].
4. Limits on expansion, duration, and later wind‑down
The GL made clear it did not authorize expansion of Chevron’s JVs into new fields or new projects, reinforcing that the permission was to operate legacy assets only, and subsequent administrative actions amended and ultimately moved to wind down aspects of GL 41—OFAC later amended GL 41 to permit only wind‑down transactions and issued follow‑on authorizations and extensions for limited wind‑down activities [2] [7]. Legal trackers and CRS reporting observed that the license’s practical effect changed over time, with later Treasury actions narrowing or terminating the operational permissions granted in late 2022 [8] [7].
5. Competing narratives and the limits of public reporting
Supporters of the license argued it enabled increased Venezuelan oil output without funding the government, a claim reflected in congressional overviews tying GL 41 and related authorizations to production growth in 2023, while critics and some legal alerts warned the carve‑outs risked loopholes or subsequent political reversals; contemporaneous reporting also emphasized that many of the license’s fine print details and subsequent amendments were distributed via OFAC notices and legal advisories rather than broad public statements [10] [9] [11]. Available sources document the license text and the prohibitions noted above [1] [2], but full operational mechanics—such as how Chevron routed sales receipts in practice—are not exhaustively detailed in the cited Treasury and legal summaries, and therefore lie beyond the public record assembled here [5] [8].