Venezuela’s interim president announced that the energy deal with the US will last for 25 years
Venezuelan interim President Delcy Rodriguez stated on Saturday that an energy agreement with the U.S. would be effective for 25 years, aim to boost crude output to 1.5 million barrels per day (bpd), and maintain the country’s sovereignty over its natural resources.
Rodriguez praised the agreement in a late-night speech as a “historic” arrangement that would aid in revitalizing the economy and increasing government revenue, asserting that it would play an important part in determining the nation’s future.
“This 25-year bilateral project aims to develop 17 strategic oilfields, with a production target exceeding 1.5 million barrels per day,” Rodriguez stated on state broadcaster VTV.
That figure pertains exclusively to the bilateral agreement between Venezuela and the United States.
Rodriguez noted that the agreement’s target of 1.5 million bpd was merely an initial goal and that the comprehensive plan also encompassed the development of eight greenfield oil blocks as part of a larger expansion of the nation’s energy sector.
On Friday, President Donald Trump revealed intentions for the U.S. to assume partial control of Venezuela’s extensive oil reserves, believing that American companies can assist in revitalizing the struggling energy sector of the South American nation while also offering a new source of crude to help reduce U.S. fuel prices.
Trump offered limited information regarding the agreement, stating merely that the U.S. had obtained majority control of over 65 billion barrels of Venezuela’s proven oil reserves through a collaboration with private business.
Venezuela has the largest proven oil reserves in the world, but its production is only about 1.25 million barrels per day, which is far below its potential. Years of underinvestment, mismanagement, and sanctions have caused this shortfall.
Rodriguez stated that the agreement has the potential to generate approximately $209 billion in revenue for the Venezuelan state, based on a benchmark oil price of $65 per barrel, while also recognizing that crude prices may vary. She stated that approximately $19 from each barrel produced and sold under the arrangement would directly benefit Venezuela, offering a substantial increase to government revenue.
She stated that the nation maintained “ownership of and sovereignty” over its natural resources “while utilizing capital, technology, and operational expertise to aid the recovery of a strategic industry that has been significantly impacted by sanctions.”
On Saturday, numerous pro-government groups assembled in downtown Caracas to demonstrate against the presence of the U.S. in Venezuela.
Rodriguez expressed his approval of the agreement after Trump’s announcement, noting that it would enhance economic growth and boost government revenue.
Venezuelan officials are set to sign agreements next week that will grant new oil exploration and production rights to various companies, including those from the U.S.
Two sources close to the negotiations indicated on Friday that Chevron CVX. N was one of the companies anticipated to conclude discussions regarding the transition of its Venezuelan joint ventures into the nation’s new energy framework.
