November 6, 2023

OFAC Eases Oil & Gas and Gold Mining Sanctions in Venezuela

Client Advisory

The U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) provides limited relaxation of Venezuela Sanctions through new and amended OFAC General Licenses and Frequently Asked Questions (FAQ) related to Government of Venezuela on October 18th, 2023.

The Oil & Gas and Gold Mining Sectors will receive below limited sanctions relief:

Oil and Gas Sector: Effective immediately through April 18, 2024, GL 44 temporarily authorizes all transactions otherwise prohibited under the Venezuela Sanctions Regulations (VSR), relating to the Venezuelan oil and gas sector, including transactions with Petróleos de Venezuela, S.A. (“PdVSA”) and entities owned 50% or more by PdVSA (together, “PdVSA Entities”). The PdVSA Entities remain Specially Designated Nationals (“SDNs”), but new contracts or funds authorized by this general license do not require blocking or reporting.
Gold Sector: GL 43 authorizes all transactions previously prohibited by the VSR with Compania General de Mineria de Venezuela CA (CVG) -“Minerven”, and entities it owns 50% or more. GL 43 does not have an expiration date, but it could be revoked by OFAC at any time. Minerven is a Venezuela government-owned gold mining company and the only entity designated as SDN by OFAC for operating in the Venezuelan gold sector. As with the PdVSA Entities, Minerven remains an SDN and its property that was previously blocked due to US sanctions remains blocked. But the new contracts or funds authorized by this general license do not require blocking or reporting. Additionally, OFAC has stated in the October 18 Guidance that it “does not intend to target [under US secondary sanctions] any person solely for operating in the gold sector of the Venezuelan economy… contingent on continued concrete steps toward a democratic solution in Venezuela.”
Others: General License No. 45, authorizing transactions ordinarily incident and necessary to the repatriation of Venezuelan nationals from non-U.S. jurisdictions in the Western Hemisphere to Venezuela; General License No. 3I, authorizing dealings in specified bonds. General License No. 5M, authorizing transactions related to the financing for PdVSA 2020 8.5 Percent Bond; and General License No. 9H, authorizing transactions that are ordinarily incident to dealings in any debt or equity in PdVSA.
FAQs: new FAQs 1136, 1137, amended four FAQs 595, 661, 662 and 629, and a related document "Frequently Asked Questions Related to the Suspension of Certain U.S. Sanctions with Respect to Venezuela on October 18, 2023."

What does this mean for You?

Exporters/Importers/Trade related parties please understand the General Licenses’ requirements that can allow your company to explore your business and ship to Venezuela.