Ret. U.S. Army Col. Jacobs on challenges for U.S. oil firms in Venezuela

Summary

Retired U.S. Army Col. Jack Jacobs discusses the security and infrastructure challenges facing any effort to revive Venezuela's oil industry. He says offshore military assets are insufficient, crumbling pipelines, roads, ports, and refineries would require long-term on-the-ground security, and Iraq-style reconstruction is unlikely to pay for itself. He also doubts that oil revenues would flow into rebuilding Venezuela, suggesting much of the crude would be refined in the U.S. instead.

• Retired U.S. Army Col. Jack Jacobs joins CNBC to assess U.S. oil operations in Venezuela.
• Orinoco oil fields are far from ports and linked by crumbling pipelines and roads.
• Security would be needed at coastal, refinery, and pumping locations, likely requiring U.S. forces.
• Jacobs is skeptical of Iraq-style reconstruction comparisons that pay for themselves.
• He says the key issue is where the money ultimately goes.
• He doubts funds will be used to refurbish Venezuela or create local opportunities.
• If Venezuelan oil is developed, he expects it would likely be refined in the U.S.