Eni Secures Key Role in Venezuela's Oil Industry with Junin 5 Deal

Italy's Eni has signed a new oil project deal in Venezuela, securing its position as a key player in the country's oil industry. The agreement allows Eni to develop the Junin 5 heavy oil project in the Orinoco Belt and invest $1.5 billion annually for 25 years. This move is seen as an opportunity for the company to unlock future production and recover existing receivables, with a potential output of 400,000 barrels per day by 2030.

The deal comes after nearly three decades in Venezuela, where Eni has accumulated over $2.3 billion in outstanding receivables from state-owned oil group PDVSA. Despite political upheaval and U.S. sanctions, Eni decided to deepen its commitment to the country, which is now yielding results.

Eni's Chief Executive Claudio Descalzi said that work would start immediately at Junin 5, with drilling set to begin on the first well tomorrow. The company also owns a stake in the Perla field and Corocoro offshore oil field, where production was halted in 2019 due to U.S. sanctions.

The agreement is part of Washington's efforts to revive Venezuela's oil industry, which has been crippled by economic collapse and U.S. sanctions. The deal also provides an opportunity for Eni to recover its existing receivables, with the company producing about 64,000 boepd in Venezuela.