OFAC Winds Down Venezuela-Related Petroleum Authorizations

Washington, D.C. (March 25, 2025) - On February 26, 2025, President Trump announced that his administration would be reversing authorizations previously granted to Chevron Corporation in response to a political agreement between the Maduro government and the Unitary Platform. (See our previous alert, U.S. Suspends Select Venezuela Sanctions Following Political Agreement, for more information).

Following President Trump’s announcement, on March 2, 2025, the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) issued Frequently Asked Question 1218, noting that “Treasury is preparing to take action to wind-down General License 41 and other specific licenses as appropriate” and that OFAC “will issue additional guidance to assist implementation concurrent with any changes to the authorization(s).”

Two days later, on March 4, 2025, OFAC issued updated Venezuela General License (“GL”) 41A, which replaced and superseded GL 41, issued on November 26, 2022. Updated GL 41A provided a wind-down period through early April for transactions previously authorized by GL 41, including certain natural resource extraction operations in Venezuela conducted by Chevron Corporation and its subsidiaries. On March 24, 2025, OFAC issued an updated GL 41B, replacing and superseding GL 41A, and extending the wind-down period for the same transactions previously covered by GL 41A through 12:01 a.m. EDT, May 27, 2025. Additionally, GL 41B clarified in a new Note 2 that it does not authorize “any expansion of the Chevron [Joint Ventures] into new fields in Venezuela.” Notably, nothing in GL 41B relieves any person from compliance with other laws or regulations, including any applicable requirements imposed by the Department of Commerce’s Bureau of Industry and Security or other federal agencies.

Separately, on March 6, 2025, OFAC issued GL 5R, “Authorizing Certain Transactions Related to the Petróleos de Venezuela, S.A. 2020 8.5 Percent Bond on or After July 3, 2025,” which replaces and supersedes GL 5Q. Under GL 5Q, U.S. persons would have been authorized to conduct certain financing transactions and enforce certain bondholder’s rights beginning March 7, 2025. However, GL 5R has extended the effective date of those authorizations until July 3, 2025.

Lewis Brisbois’s attorneys are actively engaged in the wide range of legal issues in this area and are advising clients on managing legal and business risk as events continue to develop at an accelerated pace. Visit our Ukraine Conflict, International Trade, Export, Import and Investment Controls & National Security Practice page for additional alerts in this area.

Author:

George Leahy, Associate

Editor:

Andrew Pidgirsky, Partner and Chair of Ukraine Conflict, International Trade, Export, Import and Investment Controls & National Security Practice