Venezuela Grants US-Backed Firm Historic Oil Field Concessions
Venezuela has granted US-backed oil firm North American Blue Energy Partners (NABEP) a historic concession to develop 17 oil fields, covering nearly all of its massive reserves.
The deal is part of an agreement announced by President Donald Trump last Friday and grants NABEP 100-year concessions for the fields with proven reserves of about 65 billion barrels, according to the White House.
NABEP is the second-largest private oil producer in Venezuela, and as a result of this agreement, it has granted the US Department of War's Office of Strategic Capital an equity stake of 35% in its corporate parent. This represents up to 'hundreds of billions in value and dividends for the United States', according to the White House.
Under the terms of the deal, the US will have the right to purchase at production cost a guaranteed 20% of NABEP's oil output from all current and future fields it operates. The US also has the 'right of first refusal' to buy the remaining 80% of NABEP's production.
NABEP plans to invest up to $100 billion in new infrastructure to scale oil production in Venezuela, which remains at a fraction of its capacity due to decades of mismanagement and sanctions. The company is expected to pay $200 billion in royalty and tax payments to Venezuelan governments over the first 25 years.