US Energy Firms Near Deal to Invest in Venezuela's Oil Reserves
US energy companies are on the cusp of sealing deals to invest in Venezuela's vast oil reserves, marking a significant shift in the bilateral relationship between Washington and Caracas.
The negotiations, which have been ongoing for months, involve multiple US energy firms, including Chevron Corporation and Halliburton, according to reports from The Wall Street Journal. Executives from these companies are expected to sign deals in the coming week, with US Energy Secretary Chris Wright also scheduled to travel to Venezuela.
The potential agreements would represent a major reconstruction of the energy relationship between the two countries, which was severed years ago. Under the proposed structure, Caracas would benefit through development of the country's deposits by private firms and subsequent revenue increases.
However, not all major US energy companies are moving at the same pace. ExxonMobil and ConocoPhillips, two of Chevron's largest American rivals, are not currently planning to join talks on additional Venezuelan investments due to historical reasons, including asset seizures by former President Hugo Chavez in 2007.
The structure of any eventual agreements will determine how much exposure US companies take on in a country with a long history of contract renegotiation and asset nationalization. Venezuela's oil sector has been in a prolonged state of contraction, with production peaking at around 3.5 million barrels per day in the late 1990s and falling sharply since.