OFAC licence sought as Colombia plans Venezuela gas and electricity projects

Colombia says it is seeking a US Treasury OFAC licence to allow Ecopetrol to pursue ventures with Venezuela, including electricity projects and natural gas development. Officials have also raised the possible reopening of a cross-border gas pipeline. The move follows Colombia’s renewed ties with Venezuela amid ongoing US sanctions rules.

Colombia said it was seeking a US exemption from sanctions to fund Venezuelan power and gas projects. Officials said the plan could include reopening a cross-border gas pipeline. The move required a licence from the US Treasury office that enforces sanctions. Colombia said it aimed to avoid penalties linked to investing in Venezuela.

Mines and Energy Minister Edwin Palma said Colombia was asking the Office of Foreign Assets Control, or OFAC, for permission. Palma added that Ecopetrol was talking with US officials about rules for joint work. Colombia said the proposed ventures would involve coordination with the Venezuelan government across energy sectors.

US sanctions and OFAC licence for Venezuela projects

Colombia said firms or state bodies needed a special US licence to invest in Venezuela. Without one, investors risked strong punishment. Officials cited threats such as losing access to the US financial system. They also warned that assets held in the United States could be seized.

The United States had eased some restrictions tied to Venezuela’s oil industry. The change followed a US military raid that captured then-President Nicolás Maduro. After that shift, several US companies were able to buy and sell Venezuelan oil. Colombia said it was now seeking clarity on what was allowed.

Colombia gas imports and Petro’s Venezuela policy

President Gustavo Petro had criticised US sanctions on Venezuela for years. Petro said the measures contributed to Venezuela’s long economic crisis. Colombia’s interest in Venezuelan natural gas returned in 2022. That was when Petro took office and restored diplomatic ties with Venezuela.

Despite renewed relations, Colombia said sanctions blocked action by its national oil company. Colombia also faced a changing gas situation at home. In December 2024, Colombia began importing gas on a massive scale. The country had been self-sufficient for four decades before that shift.

Critics said Petro had discouraged companies from starting new gas ventures in Colombia. Officials did not address that claim in the statement. However, the import trend raised interest in nearby supplies. Colombia said Venezuelan gas and electricity projects could support regional energy stability if approvals were granted.

Pipeline reopening plans and LPG export from Venezuela to Colombia

Colombian officials said they wanted to reopen a gas pipeline built in 2007. The line had been idle since 2019. Officials linked the shutdown to political disputes and poor maintenance. The pipeline was described as a key option if gas cooperation expanded between the neighbours.

Talks between Petro and Venezuela’s acting President Delcy Rodriguez were cancelled last week. Even so, officials held bilateral meetings across defence, commerce and energy ministries. After those meetings, Venezuela sent a small liquefied petroleum gas shipment. It moved by tanker trucks that crossed the shared border.

Rodriguez described the shipment as an early move in renewed trade. "This is the first step... the first LPG export from Venezuela to Colombia,\" Rodriguez told reporters. Colombia said the delivery supported discussions on wider energy links. Officials also pointed to the pipeline as a larger next step.

Colombia said it was continuing discussions with US officials on legal requirements. The government said OFAC approval was central to moving ahead with investments. Officials also indicated talks with Venezuela would continue through sector-level meetings. Any pipeline restart and larger projects would depend on licences and maintenance work.

With inputs from PTI