Via Teleconference
MODERATOR: Thank you. Good morning, everyone. Thank you for joining us today for an NSC backgrounder call on the situation in Venezuela and U.S. actions that we’ll be taking.
At this time, participants, please note that we have — just for your awareness, not for reporting — on the line, we have [senior administration official], [senior administration official], and [senior administration official].
Again, that is just for your awareness, not for reporting. The contents of the call will be attributable to “senior administration officials,” and it will be embargoed until 3:30 p.m.
With that, I will — I would like to turn it over to [senior administration official].
SENIOR ADMINISTRATION OFFICIAL: Great. Thank you very much, and it’s a pleasure to be here with everyone this morning. Thank you to everyone for calling in and for your interest. Venezuela is a very important issue for this administration, and it’s a critical time, so I’m really pleased to be here with my colleagues from the other agencies.
The purpose of this call is to share with you that later today, Treasury will announce that General License 44 will not be renewed, and we will instead issue General License 44A, authorizing a 45-day wind-down period for transactions related to oil and gas sector operations in Venezuela. I will let my colleague speak to some of the technical aspects of this decision and some of the current concerns that we have about the current situation in Venezuela.
But I did want to provide a few words at the top to explain why we made this decision and its implications. General License 44 — or what we refer to as “GL 44” — was issued in October of last year to support commitments that were made in the Barbados Agreement, an agreement that was signed by representatives of Nicolás Maduro in Venezuela and members of the political opposition. This Barbados agreement was signed on October 17th, 2023.
Since the GL 44 was issued last October, we have been consistent in our public messaging and our private messaging that maintaining this sanctions relief in Venezuela’s oil and gas sector depends on Maduro’s commitment to uphold the Barbados Agreement. And over the past six months, the U.S. administration has been closely monitoring the situation in Venezuela, and we’ve remained in very close touch with a range of stakeholders to assess the Venezuelan authorities’ progress on implementing the Barbados Agreement, which is intended to allow for an inclusive and competitive election in 2024.
Over the past several months and weeks, we have completed a very careful review, and we have determined that although the Venezuelan authorities have met some key commitments, they’ve also fallen short in several areas. The areas in which they have fallen short include the disqualification of candidates and parties on technicalities and what we see as a continued pattern of harassment and repression against opposition figures and civil society.
We were particularly concerned by the fact that the Venezuelan authorities also blocked the leading opposition candidate María Corina Machado from running and also did not allow her designated alternative candidate, Dr. Corina Yoris, to register as a candidate for the presidency.
As a result of those actions, while Maduro and his representatives have upheld certain aspects of the Barbados Agreement with respect to beginning to update the electoral registry, of starting a process to allow international election observation, and establishing an electoral timeline, Maduro and his representatives have not followed through with one of the most critical commitments, which was — (a fire alarm sounds) — (inaudible) the right of all candidates to run.
And, apologies, we have an alarm going off here.
In order to ensure that the expiration of GL 44 does not provoke uncertainty in the global energy sector, the administration —
[Moderator], I’m just going to hold here until this alarm ceases. You can go to the other speakers, and I’ll come back on the line. Thanks.
MODERATOR: Sounds great. Apologies for the interruption here, guys. We’ll go on to [senior administration official].
SENIOR ADMINISTRATION OFFICIAL: Thanks very much. And as [senior administration official] shared, we issued GL 44 to support commitments made in the Barbados Agreement. Unfortunately, Maduro and his representatives did not fully comply with the spirit or the letter of the agreement.
In public statements, we outlined many of these undemocratic actions. Maduro and his representatives maintained the disqualification of opposition primary winner María Corina Machado. When María Corina Machado expressed her willingness to identify a consensus substitute with other opposition members, Maduro representatives prevented the democratic opposition from registering Dr. Corina Yoris.
Maduro representatives unjustly detained multiple opposition political members in civil society, and we witnessed a disturbing campaign of harassment and an intimidation of opposition actors solely for exercising their political rights to assembly and campaign.
While our focus today is on GL 44, I want to stress the enormous courage, resiliency, and pragmatism of the opposition under these difficult circumstances.
We are in regular contact with opposition representatives, and I want to highlight that it’s quite clear that they and the vast majority of Venezuelans still want and are making every effort to achieve a competitive election with a serious opposition candidate on the 2024 ballot.
Our action on GL 44 should not be viewed as a final decision that we no longer believe Venezuela can hold competitive and inclusive elections. We will continue to engage with all stakeholders — including Maduro representatives, the democratic opposition, civil society, and the international community — to support the Venezuelan people’s efforts to ensure a better future for Venezuela.
The Barbados Agreement still represents the best available path toward a more democratic, secure, and prosperous Venezuela if fully implemented.
MODERATOR: Thank you very much, [senior administration official].
We will — [senior administration official], are you still on the line? Okay. Sounds like we’re having some technical difficulties with [senior administration official].
We will go now to [senior administration official].
SENIOR ADMINISTRATION OFFICIAL: Great. Thanks so much.
Hi, everybody. This is [senior administration official]. And while my colleagues have discussed the policy today, I wanted to take just a moment to go over some of the technical aspects of today’s action.
General License 44A issued today will replace General License 44, which means that any activity that was previously allowed under General License 44 with respect to the oil and gas sector of Venezuela will need to be wound down by May 31st. New activity that was — any new activity that was previously covered by General License 44 will no longer be allowed.
So, we routinely allow for these types of wind-down windows to allow people to wrap up their business in an orderly manner and not cause unwanted spillover effects.
As you may know, our general licenses are broad, public, and self-executing authorizations, which means that as long as an activity conforms with what’s laid out in the text of that public license, companies don’t need to ask OFAC permission to engage in any of the covered activities.
In all of our section’s programs, OFAC also has the authority to issue what we call specific licenses. Now, these are a little bit different. They are non-public authorizations that are issued on a case-by-case basis based on the facts of the application, and they deal with individual circumstances.
With the wind-down today of the public general license, individual companies may now apply for specific licenses related to activities in Venezuela’s oil and gas sector, which will then be evaluated on a case-by-case basis, similar to how we handle licenses in any other OFAC program.
So, the process of evaluating a specific license includes — is not public, but it does include taking into consideration the national security interests and foreign policy interests of the United States through close consultation with and receipt of foreign policy guidance from our State Department.
Today’s action will not affect other existing authorizations related to Venezuela’s oil and gas sector, such as Venezuela General License 8M or General License 41.
And back over to you.
MODERATOR: Thank you very much, [senior administration official].
We’ll try it again. [Senior administration official], are you back on our line?
SENIOR ADMINISTRATION OFFICIAL: Yes, thank you. I’m back on the line. It wasn’t a technical difficulty exactly, but I had — did have to pause for a moment. But I think that my colleagues covered the rest of the issues expertly. So, I’m happy to go to Q&A. Thank you.
MODERATOR: Great. Thank you. [Operator], would you please go over instructions on how to ask questions?
OPERATOR: Sure.
MODERATOR: And we can open up for Qs and As. Thank you.
OPERATOR: Okay. And we do have several questions here.
All right. We’ll go ahead and take the first.
Q Hello?
OPERATOR: Yes, please go ahead.
Q Yeah, this is Josh Goodman from the Associated Press. I wanted to see, in addition to the discussion of the sanctions, whether you could talk a little bit about some of the actors in the political process unfolding now in Venezuela around the election.
Has the U.S. had any direct contact with former gov- — with Governor Manuel Rosales? He was a presidential candidate who once ran against Hugo Chávez. He did not compete in the opposition primary process; however, you know, he is registered to compete.
Do you consider him a real alternative to Maduro or, as some in the opposition suggest, more of a stooge, someone who serves the interests of the government? Thanks.
SENIOR ADMINISTRATION OFFICIAL: So, thanks for that, Josh. Through our Venezuela Affairs Unit as well as folks here in Washington, we have contact with a broad, broad range of political actors inside Venezuela. And I don’t want to get into the specific nature of those discussions, but I do want to stress that our goal is to support the democratic opposition in Venezuela broadly.
And to that end, we cast a — a wide net in our conversations. And I encourage the democratic opposition, through the unitary platform and — and other venues, to come together and reach shared positions on their way forward. And I’ll just leave it at that.
OPERATOR: Okay. We’ll take our next question.
Just a reminder, please remember to state your name and outlet before your question. Thank you.
Q Hi. Thanks for doing this. This is Jennifer Hansler with CNN. I was wondering if there is any way you can quantify how many businesses or how much — what sort of transactions were made in the time that this general license was in effect and what impact you expect this to have financially on Venezuela’s oil and gas sectors? Thank you.
SENIOR ADMINISTRATION OFFICIAL: Hi, this is [senior administration official]. We don’t have the figures on what exactly — what level of business was — was conducted under the auspices of the general license. There’s not a reporting requirement, so we don’t have those exact figures. Over.
OPERATOR: And we’ll move to our next caller.
Q Hi, good morning. Do you hear me?
OPERATOR: Yes, please go ahead.
Q Okay. This is Juan Hernando from TV Colombia. Just to be clear, so this period of 45 days is only to wind down operations of enterprises that already have commitments or business with (inaudible)? It doesn’t allow new enterprises to make business during that period of 45 days?
And the other question is: How coordinated was this decision with the Colombian government and Gustavo Petro, taking into account that he has been engaging directly with Nicolás Maduro? Thank you.
SENIOR ADMINISTRATION OFFICIAL: This is [senior administration official] again. I’ll take the first part of that. Under — under a wind-down general license, it is to wind down and to have an orderly completion of transactions that were in progress under the general license — that was General License 44 — that was issued in October.
If it’s about activity that was outside the scope or otherwise authorized that wasn’t under the general license, it’s not going to be affected by this wind-down. So, if folks took on new activity that needed General License 44 to be compliant with our sanctions, it’s that activity that we would expect to be wound down under our — under our wind-down authorization that we’re issuing today.
Over.
SENIOR ADMINISTRATION OFFICIAL: This is [senior administration official]. I’ll start on the first part of the — of the question on the engagement with — with Colombia.
So, from the beginning, it’s been extremely important to us that we — we maintain close contact and collaboration with a wide range of partners and allies on issues with respect to Venezuela. And that inc- — certainly include- — includes those in the region, including Colombia.
And so, we have engaged with Colombia on this. They are aware of and — and tracking, at a minimum, the difficulties that we’ve seen and our perspective on Venezuela’s overall compliance with the Barbados Agreement.
And then, I’ll share with my colleague [redacted] for any other perspective. Thank you.
SENIOR ADMINISTRATION OFFICIAL: Nothing to add.
OPERATOR: Okay. We’ll go ahead and take our next question.
Q Hi, this is Rafael Rojas from BBC Mundo. I wanted to ask whether you had any information on the possible facts, going back to the previous question, that Colombia might play a role as an overseer in the election. And what — what news does the U.S. have on — on a role of overseer from the partners in the Venezuelan election?
SENIOR ADMINISTRATION OFFICIAL: So, we support the presence of international electoral observers in Venezuela, and we understand that Colombia has been invited to send observers for the process. That would be in addition to the invitations to the European Union and the Carter Center and other organizations.
Having an international presence we consider positive. Colombia, as a border country to Venezuela, has important relationships and interests. That means that their engagement is something that’s important to the Colombian government and people. And I think it can be a positive impact on — on the way forward toward a more democratic Venezuela.
OPERATOR: Moving to the next caller.
Q Yes. Hello, this is Matt Spetalnick with Reuters. So, a couple questions, please. What, if any, considerations were given in the sanctions decision on the impact it might have on spurring higher global oil prices, including at the pump in the U.S., and on the number of Venezuelan migrants flowing to the U.S.-Mexico border?
And separately from that, is the administration leaving in place the separate license that removed the secondary trading ban on certain Venezuelan sovereign bonds (inaudible) PDVSA’s debt equity?
SENIOR ADMINISTRATION OFFICIAL: I’ll take the first part of that. So, in making this determination of whether or not Venezuelan authorities were in compliance with the Barbados Agreement, we really focused on the political circumstances and situation in Venezuela.
But, of course, there was an interagency process that accompanied this that was able to bring in a wider array of interest and issues, which were, of course, part of the overall context of this — of this decision. But fundamentally, the decision was based on the — the actions and non-action of the Venezuelan authorities.
OPERATOR: And we’ll take the next caller now.
Q Thank you for this opportunity. I’m Carla Angola from (inaudible) Network, and my question is: The extent of the authorization for Chevron in Venezuela arose from agreements in Mexico, which were part of a concession to the Maduro regime to motivate them to sit at a negotiating table. Are those Chevron licenses going to be reviewed as well? In any case, what is the difference between that license and License 44 if Maduro’s failure to comply with the agreements is the same?
And regarding the hostage exchanges with the Maduro regime, when Alex Saab was sent to Venezuela, Madura released arrest warrants against members of María Corina Machado’s Vente Venezuela political party. But three months later, Maduro reissued those arrest warrants against them. And today, they are either in a prison or torture center, or they are taking refuge in an embassy.
It looks like you handed over Alex Saab in exchange for no one, because those people are still persecuted today. How serious is it for you? That seems to have been just a disguise by the Maduro regime. Thank you so much.
SENIOR ADMINISTRATION OFFICIAL: [Senior administration official], do you want to take the first part, and I’ll take the second part?
SENIOR ADMINISTRATION OFFICIAL: Sure. Happy to do it, [senior administration official]. So, on — on the question about the Chevron-related license — that’s General License 41 — as we’ve said before in — in evaluating this most recent batch of sanctions relief that came in October, what we’ve said is that we would look at that and any calibrations to it, up or down, to be proportional with the progress made under the Barbados Agreement.
And so, I would just say: Recall that the Chevron predated that by a period of time, and that was a base-level commitment to reengage in the talks, which did happen. And so, this — this decision point, which is, you know, with the commitments under Barbados and since October, has there been a meeting of those commitments, and, if not, what is our proportional response, that’s what you see today in the issuing of the wind-down.
MODERATOR: [Senior administration official], did you want to take the next other part?
OPERATOR: I’m looking at the line here. We may have lost [senior administration official].
Oh, yes, I see he’s reconnecting now. Just a moment.
MODERATOR: Could we go to the next question and maybe come back if he can answer that second part of the question?
OPERATOR: Certainly.
MODERATOR: Thanks.
OPERATOR: We’ll go ahead and take the next caller for now.
Q Hello, it’s Michael Stone here from the Financial Times. Thank you for doing this. I understand that the Chevron license continues intact, but could you clarify whether the licenses that were issued to Trinidad and Shell for gas and to Repsol and Maurel & Prom for oil, whether those also continue or whether those have been canceled?
And, secondly, what impact do you believe the totality of the package announced today is going to have on Venezuelan oil production and output over the coming months? What sort of reduction will there be as a result of these measures?
SENIOR ADMINISTRATION OFFICIAL: Gotcha. This is [senior administration official]. I’m happy to take the — the first part.
I think you’ve asked about a couple of different items that may have come in. As I mentioned in my, sort of, opening remarks, we have two types of licenses that we give. Some are general licenses. Those are public. But we also allow individual parties with particular fact patterns that ask to come in, and we evaluate them on a case-by-case basis for specific licenses. And those are — are non-public and protected through — through law, as far as discussing the details of them, although the — any party that submits that can release that.
So, I don’t have more to share on those particular items related to specific parties.
SENIOR ADMINISTRATION OFFICIAL: Hey, this is [senior administration official]. My — I got dropped from the call earlier, but I’m back.
OPERATOR: Okay. [Senior administration official], did you want to address the portion of the question that you were going to?
SENIOR ADMINISTRATION OFFICIAL: Happy to do so. So, we are very concerned about the arrest of Henry Alviarez and Dignora Hernández and the issuance of arrest warrants for seven other advisors to María Corina Machado, the harassment of opposition members, and the detention of other civil society actors, including Rocío San Miguel.
We are continuing to raise those issues with the other side. But we’re also proud that, through this process, we’re able to obtain the release of six wrongfully detained American citizens, to secure the release of and return of others who are in jail in Venezuela, including the return of a fugitive from justice from the United States.
We continue to believe that the Barbados Agreement represents the only important and viable path forward, but the other side has failed to comply with its obligations. And for that reason, we’ve taken the steps that we’re taking today.
And we will continue to talk to our friends and allies and make common cause with them to try to secure the release of all those who are wrongfully detained or arrested or jailed in Venezuela for expressing their fundamental human rights and civic rights in that country.
OPERATOR: Okay. We’ll go ahead and take the next caller here.
Q Hi. Good morning. Thank you so much for doing this. I have a question. Does President Biden continue to believe in Nicolás Maduro’s goodwill as it has been described on several occasions before? And will this administration change or is trying to change its current policy on Venezuela?
And, also, what are the concerns about the — just (inaudible) on that question about immigration, what are the concerns of the Biden administration on an eventual increase of Venezuela migrants arriving at the border due to a possible outcome of the elections in July?
Thank you. And Jorge with Voice of America.
SENIOR ADMINISTRATION OFFICIAL: I’ll take the first crack at that. So, the — the Biden administration remains very committed to and focused on ensuring a restoration of democracy in Venezuela and — and working to see that the upcoming elections that will take place there later this year are as free and fair and competitive — as competitive as they — they can possibly be.
And, of course, we’re very attuned as well for the welfare of the Venezuelan people and would prefer to see a situation where the people in Venezuela are able to live in a prosperous and secure setting and certainly not suffer the humanitarian challenges and the deep insecurity that — that exists today.
And so, that’s — that’s our overall objective. That’s what we’re focused on. We do believe that securing greater space for political freedom and for this election to be as democratic as it can possibly be an important step towards that.
With respect to some of the broader issues that you raise, of course, we are very aware of the migration flows that have emanated from Venezuela over the past several years. Those flows are not only affecting the United States, but they’ve really had broad impacts across the region, including in Venezuela’s close neighbors, such as Colombia and Brazil, and other parts of Latin America and Central America.
And so, this administration is also very committed to working cooperatively with our partners throughout the hemisphere on migration management to make sure that it’s more effective, that it’s humane, and that the need for people to or desire for people to cross their borders without documentation can be vastly reduced. That’s something that we are working on with all of our partners in the region. And that is something that will remain a priority for the Biden administration.
OPERATOR: Okay. I believe we have time for one more question. We’ll go ahead and take the next caller here.
And, caller, you can go ahead. Please make sure that your device is also unmuted.
Q Okay. Sorry. Hi, Juan Carlos López from CNN Español. Thank you for the call.
So, there were recent meetings between the U.S. and Venezuela and Mexico. There was also meetings between Colombia and Venezuela. Is there anything the Venezuelan government, the Maduro government, can do from here to May 31st to reverse this decision? Or is this decision a sign that there is no going forward with them?
And what happens if these elections go forward? Do you have any leverage that you can use against Venezuela? And on the license that was — that is not being renewed, since you don’t know figures, does that license benefit any American companies, or would that only benefit the Venezuelan government?
Thank you.
SENIOR ADMINISTRATION OFFICIAL: I’ll take the — the first part of the question. So, we’ve been very committed to engaging with a wide range of Venezuelan stakeholders to try to move and to help move the political process forward in Venezuela. And that includes, at certain junctures, direct engaging with the Venezuelan authorities. Certainly, it includes maintaining a constant level of communication with Venezuelan civil society, opposition figures, with partner nations in the Western Hemisphere, and partners more broadly, internationally.
And so, that is — that is going to remain our focus.
With respect to the current General License 44 that we are discussing, this was a license that was granted for six months and had an expiration date. And so, this was a question that we had to address, essentially, today and over the past several days and weeks of whether or not the progress that has taken place in Venezuela merits the renewal of the license.
We determined that Venezuela has thus far fallen short of its commitments in terms of opening up the democratic and electoral process and, therefore, made the decision not to renew the license and to allow it to expire, as my colleagues have described. However, that does not mean that we are not going to still continue to engage in a constructive and pragmatic way to try to move the election back towards a better course.
And I think there’s some near-term decisions that the Venezuelan authorities will be taking that we will be watching and monitoring very carefully. We also realize that members of the political opposition and various political parties have decisions of their own to make, and we are committed to ensuring that we have the best and most relevant understanding of the political process in Venezuela and that we’re working with our partners internationally to ensure that the will of the Venezuelan people can be heard at the ballot box when an election takes place later this year.
MODERATOR: Thank you very much.
Thanks again to everyone for joining the call today. Thanks, [Operator], for all your support.
As a reminder for everyone, this call was on background for attribution to “senior administration officials.” The call is embargoed until 3:30 p.m. this afternoon. We will also be sending an embargoed statement that the State Department will release later this afternoon. The embargo for the statement and this call will both lift at 3:30 p.m.
Thank you again to our speakers for joining us. And thanks, everyone. Have a great day.
OPERATOR: Thank you to all of our speakers, and thank you all in the audience for joining us today. Again, this call was off the record.
The call has concluded, and you may disconnect.
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