Chevron has announced plans to invest over $7 billion in its joint ventures in Venezuela to double oil production to approximately 600,000 barrels per day within the next five years. The expansion will take place in the Carabobo region of the Orinoco Belt through Chevron’s Petroindependencia joint venture, with new agreements in place to include two adjacent areas.
Chevron’s CEO, Mike Wirth, expressed confidence in Venezuela’s resource potential and its competitiveness for long-term investment. This move comes shortly after U.S. President Donald Trump revealed a significant deal involving a portion of Venezuela’s oil reserves, where the U.S. government acquired an equity stake in a private oil company operating in the country. While separate from this deal, Chevron’s expansion aligns with Trump’s efforts to boost oil output in Venezuela.
Venezuela boasts the world’s largest oil reserves, yet its current production stands at only 1.25 million barrels per day, a significant decline from levels seen two decades ago due to mismanagement and underinvestment by the state-run oil firm PDVSA. The country aims to increase its total oil output to two million barrels per day by the end of the decade, as outlined by U.S. Energy Secretary Chris Wright.
Chevron’s new agreements in Venezuela include favorable fiscal, commercial, and legal terms aimed at safeguarding long-term investments, with projected production costs below $20 per barrel. The company intends to leverage existing infrastructure and facilities for development in the new areas, ensuring cost-effective growth.
Besides Chevron, other energy companies such as ENI, KEO Capital, and Primavera are poised to sign energy agreements in Venezuela, aligning with the country’s efforts to revamp its energy sector. These agreements represent expansions negotiated under a broad oil reform approved in January.
Following the U.S.-supported leadership transition in Venezuela earlier this year, Trump has advocated for a $100-billion reconstruction plan for the country’s energy sector, encouraging American oil companies to invest. Chevron’s longstanding presence in Venezuela contrasts with other oil majors, like ExxonMobil and ConocoPhillips, which exited the country in 2007 when their assets were nationalized.
Chevron’s commitment to expanding its operations in Venezuela underscores the shifting dynamics in the global energy landscape, with the potential emergence of a major U.S. oil player through strategic investments in the region.