Eni Seals Deal with Venezuela's PDVSA to Develop Junin 5 Project

Italian oil company Eni has signed a new deal with Venezuelan state-owned oil group PDVSA to develop the Junin 5 heavy oil project in the Orinoco Belt. The agreement marks a significant step for Eni, which has been operating in Venezuela for nearly three decades and has accumulated over $2.3 billion in debt from PDVSA.

The deal provides Eni with a key role in U.S.-backed efforts to revive Venezuela's oil industry and could see output at the project reach 400,000 barrels per day by 2030. Eni and PDVSA plan to invest around $1.5 billion annually in the project.

Eni Chief Executive Claudio Descalzi said that work would start immediately at Junin 5, with drilling set to begin on the first well as early as tomorrow. The deal is seen by analysts as an opportunity for Eni to unlock future production and recover existing receivables.