Venezuela’s Maduro Offered the U.S. His Nation’s Riches to Avoid Conflict

Venezuelan officials, hoping to end their country’s clash with the United States, offered the Trump administration a dominant stake in Venezuela’s oil and other mineral wealth in discussions that lasted for months, according to multiple people close to the talks.

The far-reaching offer remained on the table as the Trump administration called the government of President Nicolás Maduro of Venezuela a “narco-terror cartel,” amassed warships in the Caribbean and began blowing up boats that American officials say were carrying drugs from Venezuela.

Under a deal discussed between a senior U.S. official and Mr. Maduro’s top aides, the Venezuelan strongman offered to open up all existing and future oil and gold projects to American companies, give preferential contracts to American businesses, reverse the flow of Venezuelan oil exports from China to the United States, and slash his country’s energy and mining contracts with Chinese, Iranian and Russian firms.

Though the United States has been targeting what it calls drug boats, the cutoff of diplomacy, the military buildup near Venezuela and the increasingly strident threats against Mr. Maduro by Trump administration officials have led many in both countries to think that the Trump administration’s real objective is Mr. Maduro’s removal.

Marco Rubio, the U.S. secretary of state and national security adviser, has been the leading voice in the administration’s push to oust Mr. Maduro. He has called Mr. Maduro an illegitimate leader who is a “fugitive from American justice” and has been skeptical of the diplomatic approach conducted by a special U.S. envoy, Richard Grenell.

Proponents of diplomacy acknowledge that Mr. Rubio’s hard line approach has prevailed for now. But they believe their efforts could eventually bear fruit, pointing to Mr. Trump’s sudden reversals on other major foreign policy issues, such as the war in Ukraine, trade with China or Iran’s nuclear program.

This article is based on interviews with more than a dozen American and Venezuelan representatives of disparate factions calling for diplomacy with Mr. Maduro. They described their discussions on condition of anonymity because they were not authorized to speak publicly.

Behind the scenes, however, Venezuela’s senior officials, with Mr. Maduro’s blessing, have offered Washington far-reaching concessions that would essentially eliminate the vestiges of resource nationalism at the core of Mr. Chávez’s movement.

While Mr. Grenell and Venezuelan officials made progress on economic issues, they failed to agree on Mr. Maduro’s political future, according to the people close to the negotiations. Venezuela’s foreign minister, Yván Gil, said in an interview last month that Mr. Maduro would not negotiate his exit.

Mr. Maduro has repeatedly repressed democratic challenges to his rule after assuming the presidency in 2013. He held on to power last year after losing a presidential election by rigging the results and brutally suppressing protests.

Mr. Grenell declined to comment for this article. The State Department, the White House and Venezuela’s government did not respond to requests for comment.

In Washington, American officials offer differing assessments of the talks. One U.S. official said the reports of negotiations over the lifting of sanctions and access to the Venezuelan market was “not an accurate assessment of what took place.”

But other American officials said U.S. and Venezuelan officials held repeated talks over what economic normalization would look like, including access to Venezuelan energy markets by American companies and a lifting of U.S. sanctions.

As Mr. Grenell and Mr. Maduro’s envoys negotiated a deal, the leader of Venezuela’s main opposition movement, María Corina Machado, pitched her own economic proposal in Washington.

She argued that even greater economic wealth — $1.7 trillion in 15 years — awaited U.S. companies in Venezuela if her movement launched a political transition.

Her economic adviser, Sary Levy, said the investment deals offered by Mr. Maduro would never materialize without democracy, rule of law and individual freedoms.

“What Maduro offers investors is not stability, it's control — control maintained through terror,” said Ms. Levy. “The Trump Administration has shown a clear intention to not fall for these offers of easy solutions.”

Venezuela currently produces about one million barrels of oil a day, down from about three million when Mr. Chávez took power. The bulk of Venezuela’s oil exports go to China, except for about 100,000 barrels per day that the U.S. energy giant Chevron sells to the United States. Most experts agree that Venezuela could quickly ramp up oil output with a major injection of foreign capital, though they differ on whether this is achievable under the current government.

“Our message to the oil companies is: We want you here, certainly,” Ms. Machado told American corporate representatives in June. “We want you here not producing crumbs of a couple hundred thousand barrels a day. We want you here producing millions of barrels a day.”

Ms. Machado declined to comment for this article.

In the past, the United States framed its support for a new government in Venezuela as a human rights imperative. In contrast, the economic points discussed by Mr. Maduro’s envoys with Mr. Grenell echoed a mercantilist worldview that Mr. Trump has promoted elsewhere.

Mr. Trump has demanded access to Ukrainian minerals as payment for U.S. support for Kyiv’s war effort. He has frequently lamented that the United States did not get Iraqi oil after the 2003 invasion. He agreed to keep U.S. troops in Syria in 2019 on the condition that America would “keep the oil.”

The deal discussed between Mr. Grenell and Venezuelan officials was especially sweeping, representing arguably the most ambitious attempt at resource diplomacy during the president’s second term.

Normalizing trade and allowing American companies back into Venezuela could be tempting to some U.S. officials because of the country’s oil reserves, the world’s largest, as well as significant deposits of natural gas, gold, iron, bauxite and coltan, a mineral mix used in electric batteries.

Mr. Maduro’s economic outreach to the United States has also extended to the private sector, in an attempt to strengthen his hand in Washington.

Venezuela’s state oil company has given Chevron, the largest American company working in Venezuela, full control of their joint oil projects and the two entities have discussed giving Chevron a stake in another major oil field.

Venezuelan officials have worked to repair relations with another U.S. oil giant, ConocoPhillips, which left Venezuela in 2007 after the government seized its operations. Mr. Maduro’s government and Conoco have been negotiating an oil trading deal as recently as this year, according to two people familiar with the talks.

Chevron said its business dealings in Venezuela comply with all applicable Venezuelan and U.S. laws. Conoco did not respond to a request for comment.

The outreach by Venezuelan officials and business leaders came closest to achieving a diplomatic breakthrough in May, according to the people briefed on the talks.

As a sign of good will, Mr. Grenell that month orchestrated the return of a Venezuelan toddler stranded in the United States after her parents were deported, giving Mr. Maduro a domestic political win. Venezuela’s government reciprocated shortly afterward by releasing a U.S. Air Force veteran jailed in the country and delivering him to Mr. Grenell.

Mr. Maduro came to support most of the economic terms in the proposal discussed with Mr. Grenell.

A person familiar with the negotiations said Mr. Maduro initially wavered on the American demand to limit Venezuela’s economic ties with China, Russia and Iran.

But he eventually saw that loosening those alliances was an inevitable price for avoiding American military intervention, the person said. To maximize income in the face of U.S. pressure, Venezuela has also stopped sending oil to Cuba, worsening acute electricity shortages in the allied nation.

The proponents of economic engagement with Mr. Maduro have managed to score minor victories.

Chevron got its U.S. Treasury license to operate in Venezuela reinstated in July, according to the Venezuelan government. The company succeeded in overturning the ban imposed by Mr. Trump months earlier after a concerted lobbying push in Washington, according to people familiar with the deal.

The Treasury Department on Wednesday issued another license that in effect allows Shell, Europe’s largest energy company, to restart work in Venezuela. Under a new permit, Shell could begin producing gas from a massive offshore Venezuelan field as soon as next year, according to a person familiar with the deal.

The gas from the field, known as Dragon, will be processed and sold from neighboring Trinidad.

Shell directed questions to the license holder, the government of Trinidad & Tobago, whose officials did not respond to a request for comment.

Mr. Rubio said last month that the United States would ensure that the Dragon project would “not provide significant benefit to the Maduro regime.”

Mr. Maduro has signed off on a stipulation that would have Shell invest in social projects in Venezuela instead of paying his government. For the Maduro government, the key benefit is showing that Venezuela remains open for business.