Venezuela to Grant More Oil Drilling Blocks to Chevron, Repsol

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(Bloomberg) — Venezuela plans to grant more oil-production land to Chevron Corp. and Spain’s Repsol SA as the Trump administration pushes for private companies to rebuild the nation’s energy sector, according to people with knowledge of the matter.

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Officials in Caracas are poised to award the exploration and production blocks as soon as this week, the people said. Giving US and European companies more access to Venezuela’s oil-rich territory is a key piece of US President Donald Trump’s push to revive the nation’s dilapidated energy sector while eroding China and Russia’s local influence. 

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On Thursday, US Energy Secretary Chris Wright toured a project operated by Chevron in Venezuela’s Orinoco oil belt and told reporters that the opportunity for cooperation between the US and the South American nation is immense following the capture of former Venezuela President Nicolás Maduro. 

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“The reuniting of the talent of American businesses and the passion of the Venezuelan people and the resources here — the sky’s the limit,” he said.

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Repsol declined to a request for comment. Chevron did not immediately respond to a request for comment.

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The Trump administration is expected to issue general license to allow international oil companies to explore and produce in Venezuela without violating US sanctions, Bloomberg reported earlier this month. It would be the latest is part of a string of authorizations from the Treasury Department to open up the nation’s oil sector since US forces captured Venezuela’s former President Nicolás Maduro on Jan. 3. 

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Chevron and Repsol already have extensive holdings in Venezuela, which has among the world’s largest crude reserves. The nation’s oil industry, however, has collapsed over the past decade amid mismanagement, corruption and neglect. Venezuela’s production has plummeted to about 1 million barrels — less than a third of what it was during the 1990s. 

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Chevron is the only private Western company still pumping oil in Venezuela, operating under a special license from the Treasury Department. The Houston-based company accounts for about a quarter of Venezuela’s production.

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Repsol holds interests in various blocks but lost its authorization to produce crude last year as the Trump administration ramped up sanctions to pressure Maduro. 

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Among Repsol’s key holdings in Venezuela is Cardon IV, a joint venture with Italy’s Eni SpA, to produce gas from a giant offshore field called Perla. The gas supplies power plants in western Venezuela.

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Wright, the former chief executive officer of a US fracking company, is the highest ranking US official to travel to Venezuela in nearly three decades, highlighting the Trump administration’s embrace of acting President Delcy Rodriguez, Maduro’s former vice president.

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