Chevron, Eni and Other Energy Firms Sign Deals to Expand Oil Projects in Venezuela
Al Jazeera Staff
US Chevron, Italy's Eni and other energy companies have signed multibillion-dollar agreements to boost Venezuela's oil output, just days after Caracas agreed to give the US control over a fifth of the country's oil reserves. The deals expand existing projects and follow a separate Caracas-Washington agreement that has raised sovereignty concerns. Acting President Delcy Rodriguez and US Energy Secretary Chris Wright defended the accords as necessary for investment and growth.
Signing ceremonies took place in Caracas on September 3, witnessed by Venezuela's Acting President Delcy Rodriguez and US Energy Secretary Chris Wright. These agreements are separate from the previously announced Caracas-Washington deal, which grants the US access to 17 Venezuelan oil fields, representing about one-fifth of the country's total reserves.
Most of the new contracts involve expanding projects already negotiated with the Ministry of Petroleum and state oil company PDVSA following comprehensive oil reforms passed in January, after the US captured former President Nicolas Maduro.
Speaking at the ceremony, Secretary Wright said the agreements Venezuela signed with Chevron, GE Vernova and Eni are "key to beginning a process of peace, opportunity and prosperity" in the South American nation. He stressed that President Donald Trump's administration wants to see the fastest possible transformation in Venezuela, rather than just a slow improvement.
Under the new contracts, Chevron and Eni will expand operations in Venezuela while increasing their stakes in oil fields. Chevron, the second-largest US oil company and leading private oil producer in Venezuela, valued contracts to develop two more oil fields in the Orinoco belt at $7 billion. Production from the project is expected to more than double within five years. Eni said it had secured exclusive rights to explore the massive Junin 5 oil field. Meanwhile, GE Vernova, the energy company spun off from General Electric, will help repair Venezuela's deteriorated power grid.
The signing comes amid questions about Venezuela's sovereignty raised after the Caracas-Washington agreement, which granted a US-led company rights to exploit 17 oil fields over a 100-year term. Critics in both the US and Venezuela accuse the Trump administration of "seizing" the country following Maduro's capture and warn that Rodriguez could face a similar fate if she does not comply with Washington's demands.
However, Secretary Wright dismissed accusations that the US is "stealing Venezuela's oil." He said: "All we are doing is exploiting a resource underground that was left idle, benefiting no one, and bringing money and technology to develop it." He forecast Venezuela's total oil production, the country with the world's largest proven reserves, would reach 2 million barrels per day by the end of the decade, up from the current 1.25 million barrels per day. That figure remains well below the peak of over 3 million barrels per day in the late 1990s.
For her part, Rodriguez denied surrendering the nation's resources, arguing that allowing the US into Venezuela's oil industry was necessary to attract investment. She stressed that more oil "means more jobs, higher salaries, better public services, hospitals, schools and food." She estimated Venezuela would reap $209 billion in profits from the deals over the next 25 years.
The key role of Venezuelan businessman Alejandro Betancourt, accused of fraud, in the deal is under close scrutiny. He did not appear at the September 3 ceremony. Betancourt is linked to a corruption scandal at PDVSA and runs North American Blue Energy Partners (NABEP), Venezuela's second-largest private oil company, in which the US government will take a 35% stake under the agreement. Secretary Wright defended NABEP for its "very successful track record of producing large volumes of oil in Venezuela," calling it a "reliable business partner."
The deal marks a major reversal for the "Chavismo" movement of late socialist leader Hugo Chavez, Maduro's mentor, who nationalized Venezuela's oil fields two decades ago on an anti-imperialist platform. It also raises concerns that the Trump administration is consolidating Maduro-loyal officials like Rodriguez, who have shown no signs of willingness to hold democratic elections eight months after Maduro was ousted.
On September 3, President Trump dismissed calls from some Republican lawmakers for quick elections in Venezuela. He said: "I just think they're not ready. You know, everything is very new. We got them out of a dictatorship and we're getting along very well with the current government." Rodriguez echoed that sentiment, saying there would be "an electoral process" when "Venezuela is ready."
