Repsol Cuts Equity Exposure in Venezuela to €276 Million Amid Renewed U.S. Licensing and Production Growth

Repsol’s 2025 financial report details a marked contraction in its Venezuelan equity stake, which now comprises primarily accounts receivable from state oil company PDVSA through Repsol Exploración, financing extended to joint venture Petroquiriquire, and investments in Cardón IV and Petroquiriquire projects. Total commercial debt with PDVSA stands at €3.603 billion, net of provisions amounting to €3.019 billion; financing provided reaches €947 million with corresponding provisions of €568 million. The company incorporates multiple recovery scenarios—moderate, significant, and severe—weighted against historical sovereign default data and management’s outlook to determine expected credit losses. Due to the volatile environment, Repsol applied external expert validation to its risk assessments.

In 2025, impairments related to credit risk resulted in a €116 million write-down in commercial and financing accounts, alongside a €452 million loss on equity-accounted investments including €415 million on commercial receivables and €37 million on fixed assets. Despite these financial adjustments, operational output improved as Repsol’s net average production in Venezuela rose to 71,300 barrels of oil equivalent per day, a 6.4% increase from 67,000 barrels daily in 2024. The company traces its Venezuelan presence back to 1993 and currently exploits gas licenses such as Cardón IV and Quiriquire Gas, alongside mixed oil ventures Petroquiriquire and Petrocarabobo.

A critical development came on February 13, when the U.S. Treasury’s Office of Foreign Assets Control (OFAC) issued License 49, permitting the negotiation and signing of contingent contracts for oil and gas investments in Venezuela, including those involving PDVSA, subject to additional approvals. License 50 authorizes petroleum operations that comply with restrictions, notably prohibiting dealings with entities linked to sanctioned nations like Russia, Iran, North Korea, Cuba, and China. CEO Josu Jon Imaz underscored Repsol’s vigilance regarding Venezuela’s evolving political-institutional landscape and ongoing dialogue with U.S. and Venezuelan authorities to ensure regulatory compliance. With renewed U.S. support and robust production targets, Repsol is positioning itself to capitalize on the reopening Venezuelan oil sector while managing substantial credit risks inherent in the market.