Hilcorp owner gives political cover to Trump in pledging unknown amount of money for Venezuela
Hilcorp founder and chairman Jeff Hildebrand, one of the two dozen oil executives who joined Donald Trump at the White House Friday for a Trump praise-a-thon, promised to invest money to rebuild Venezuela’s oil industry. He didn’t say how much or when.
Same with Bill Armstrong, the Texas wildcatter who discovered billions of barrels on the North Slope. He told Trump he would go to Venezuela. He piled it on thick, claiming that he and Trump have similar instincts.
“In real estate, you were a wildcatter, so wear that, wear that motto proudly,” Armstrong said.
I don’t think that Armstrong has the records of multiple real estate bankruptcies achieved by wildcatter Trump.
“But like you I was a, my own guy, I don’t have shareholders, I don’t have private equity partners, but I’ve been drilling all over the place. Fact I had a large discovery in Alaska, biggest discovery in 50 years in our country. I now control 8 million acres adjacent to Venezuela, so I’m already heavily invested in the area. We share a 150-mile border with Venezuela in the countries of Aruba and Curacao, and we are ready to go to Venezuela,” Armstrong said.
“It is in real estate terms it is prime real estate. And it’s kind of like West Palm about 50 years ago. Very ripe,” Armstrong said.
“Yep. I agree with you. Thank you congratulations,” Trump said.
I can imagine that Armstrong might follow through in Venezuela—given his large offshore holdings near the islands—but only if the U.S. military occupies the country, the laws there are changed drastically and the U.S. somehow provides the long-term security that Trump is promising but can’t deliver.
No one in the U.S. government or the oil industry has worked any of this out.
The Homage to Trump event was largely a political exercise with little tie to the actual investment of $100 billion Trump claims the companies will put up. For all their talk, Armstrong and Hildebrand are not ready to risk billions in one of the riskiest places in the world.
“The plan is for them to spend — meaning our giant oil companies will be spending at least $100 billion of their money — not the government’s money,” according to Trump.
At one point he claimed that if the oil executives in the room, “the greatest oil men and women in the world,.” did not agree to invest in Venezuela there were many other oil companies eager to risk billions to benefit the U.S., Venezuela and “the entire world.”
“So you’re dealing with us directly. You’re not dealing with Venezuela at all. We don’t want you to deal with Venezuela,” Trump said.
Hildebrand, a billionaire who donated more than $4 million to Trump and Trump groups over a couple of years, was there to shower compliments on Trump.
He said that Trump, who recently appointed Hildebrand’s wife as ambassador to Costa Rica, a job she began this week, is a tremendous leader.
“Thank you for your great, tremendous leadership in protecting the interests in the Western Hemisphere,” Hildebrand told Trump. “The message that you have sent to China and our enemies to stay out of our backyard is absolutely fantastic. So thank you.”
“Thank you very much,” Trump said.
“And finally Hilcorp is fully committed and ready to go to rebuilding the infrastructure in Venezuela,” Hildebrand said.
“You’ll go there? You’ll be going?” Trump asked.
“Yes,” said Hildebrand.
“Good. That’s good,” said Trump. “You’ll be very happy.”
“Thank you very much,” said Hildebrand.
While Trump claimed he will get the oil industry to invest $100 billion in Venezuela, Darren Woods, the CEO of ExxonMobil, said it is impossible to invest in that country now without changing the legal and commercial networks.
Trump promised “total security” for the oil industry without saying how that would be guaranteed. He also said he and his employees would decide what oil companies will be allowed to put lots of money into Venezuela.
“One of the things the United States gets out of this will be even lower energy prices,” Trump claimed, repeating his usual claim that gas in some places is selling for $1.99.
“We have people now getting gasoline for $1.99, $1.96, $1.95, $1.92 yesterday, somebody. And it used to be $3.50, $4, $5 a gallon. Think of that—$1.99,” Trump told the oil bosses,
The last thing that all of them want is lower oil prices.
“The administration is talking out of both sides of its mouth in saying they want prices down to $50 a barrel and expanded production,” Morgan Downey, a commodities trader and the author of the book “Oil 101,” told the Washington Post.
“He said industry executives eager to stay on the good side of the White House have to publicly ‘smile and tell the president, ‘yes, you are making great decisions.’ But the numbers don’t add up.’ He is skeptical there will be much of any new production in Venezuela by U.S. firms absent drastic shifts in market prices,” the Post said.
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