Chevron to double Venezuela oil production with $7bn pledge

Chevron, the only major US oil company still operating in Venezuela, has pledged to invest $7 billion over the next five years to significantly expand its oil production in the country. This investment aims to more than double its current output to approximately 600,000 barrels per day. The announcement follows a deal orchestrated by the White House, which also involved a separate agreement giving the US government control over a fifth of Venezuela's oil reserves through a different operator.

The expansion includes securing additional acreage in the crude-rich Orinoco Belt, specifically the Carabobo 1 and Carabobo-2-South-A areas, where Chevron already has existing joint ventures like Petroindependencia and Petropiar S.A. CEO Mike Wirth stated that this expanded position reflects confidence in Venezuela's deep resource potential and its ability to compete for investment within Chevron's portfolio, citing improved terms and the goal of achieving low-cost oil growth and long-term value.

This move by Chevron comes as US Energy Secretary Chris Wright arrived in Caracas to discuss new investments. The larger deal announced by President Trump involved a private joint venture with North American Blue Energy Partners (NABEP) to operate 17 oil fields containing an estimated 65 billion barrels, with the US Department of War's Office of Strategic Capital taking a 35% stake. Experts, however, caution that due to years of neglect and decayed infrastructure, significant output growth from Venezuela's extra-heavy crude reserves could take years to materialize, despite the substantial investment pledges.

Venezuelan lawmakers approved the broader agreement, though some opposition members expressed concerns about not having seen the full terms. The deal is intended to help lower US gasoline prices and replenish the Strategic Petroleum Reserve. Chevron estimates its production cost in Venezuela to be about $20 per barrel, reinforcing the attractiveness of the venture despite the long-term challenges in developing the country's oil infrastructure.