WILLEMSTAD - Plans to restart Curaçao’s long-stalled oil refining and storage operations have been delayed due to the absence of a renewed U.S. OFAC (Office of Foreign Assets Control) license, 2Bays Energy director Patrick Newton confirmed during a briefing in Parliament this week.
Without this authorization, Curaçao is legally prohibited from processing or trading Venezuelan crude oil, halting a key component of the settlement agreement between the island and Venezuela’s state oil company PdVSA.
Expired License Stalls Agreement
The OFAC license — originally issued by the U.S. Treasury Department — expired in December 2024. 2Bays has already submitted a renewal request through its legal representatives, but it has not yet been processed by U.S. authorities.
The license is critical because it permits the receipt and export of Venezuelan crude oil, allowing PDVSA to repay its outstanding debts under the Curaçao settlement deal. Without U.S. approval, the agreement cannot proceed.
2Bays had sought a structure similar to that of Chevron’s existing OFAC authorization, which allows the U.S. oil company to conduct limited transactions with PDVSA. However, Curaçao’s request has so far been denied or delayed.
Alternative Oil Supply from Colombia
While awaiting the OFAC decision, Vigor Midstream Ltd., which took over operations from Oryx Midstream in May, is sourcing alternative crude shipments from Colombia to maintain limited storage operations at Emmastad and Bullenbaai.
Prime Minister Gilmar Pisas stated that Vigor remains committed to fully resuming activities once all permits are secured. The 30-year concession agreement with 2Bays includes annual payments of USD 15 million, of which USD 8 million has already been paid.
Impact on Workforce
The ongoing uncertainty has created anxiety among refinery workers. Under the agreement, 250 employees are set to be formally transferred to Vigor by July 1, 2027. The company, together with 2Bays, is exploring whether this process can be accelerated.
If operations expand as planned, Vigor expects to create an additional 70 jobs, revitalizing one of Curaçao’s most significant industrial sectors.
Investment and Outlook
Despite the delays, preparations at Bullenbaai continue. Over the first five years, Vigor has committed to investing more than USD 70 million, pending the completion of ongoing technical and environmental studies.
Curaçao’s oil industry has been idle since PdVSA’s departure on December 31, 2019, after decades of refinery operations. The arrival of Vigor raised hopes for an economic revival, but the project’s success now depends largely on U.S. sanctions policy and broader geopolitical developments.
As Newton summarized to Parliament:
“The infrastructure, the partners, and the workforce are ready — we’re simply waiting for the green light from Washington.”
