Chevron has announced a significant investment of over $7 billion in its Venezuela joint ventures to boost oil production to around 600,000 barrels per day over the next five years. The expansion will take place in the Carabobo region located in the Orinoco Belt. Chevron’s CEO, Mike Wirth, expressed confidence in Venezuela’s resource potential and its attractiveness for long-term investment.
This move by Chevron comes shortly after President Donald Trump revealed a deal involving a fifth of Venezuela’s oil reserves, with the U.S. government obtaining an equity stake in a private oil company operating in the country. Despite this separate initiative, Chevron’s expansion aligns with Trump’s efforts to increase oil output in Venezuela.
Venezuela holds the world’s largest oil reserves, but its current daily output is significantly lower than it was two decades ago due to mismanagement and underinvestment by the state-run oil firm, PDVSA. However, the country aims to increase its total oil production to two million barrels per day by the end of the decade, according to U.S. Energy Secretary Chris Wright.
Chevron’s new agreements feature favorable fiscal, commercial, and legal terms to safeguard long-term investments, with projected production costs below $20 per barrel. The company plans to leverage existing infrastructure and facilities in the expansion process.
In addition to Chevron, other companies like ENI, KEO Capital, and Primavera are expected to finalize energy agreements in Venezuela. These agreements are part of a broader shift in energy contracts under a recent oil reform. U.S. Energy Secretary Wright and Venezuela’s oil minister are overseeing the signing of these contracts.
Following the U.S.-led removal of former President Nicolás Maduro, Trump has advocated for a $100 billion reconstruction plan for Venezuela’s energy sector, encouraging American oil companies to invest in the country. While Chevron has maintained operations in Venezuela for over a century, other major oil producers exited the country in 2007 due to nationalization policies.
Chevron, with its long-standing presence in Venezuela, continues to strengthen its operations in the country, contributing to the evolving landscape of energy investments in the region.