Baker Hughes Signs Venezuela Gas Deal on 5 October
ENERGY · VENEZUELA
Key Facts
- —The country Venezuela, an oil producer under close US oversight since US forces captured Nicolás Maduro in January. It holds 195 trillion cubic feet of proved gas reserves, 73% of South America’s (EIA, 2023).
- —Why it matters Most of that gas comes up with crude and much is flared. Industry estimates put 2022 flaring near 706 billion cubic feet, more than Venezuela sold, the EIA says.
- —Why now Acting president Delcy Rodríguez received Baker Hughes chief executive Lorenzo Simonelli in Caracas on Friday 2 October. Three days later the company announced signed agreements.
- —What happened On Monday 5 October, Baker Hughes said it signed an alliance with state oil company PDVSA, Lindsayca and Fulcrum LNG. It also signed a memorandum with New Stratus Energy.
- —The numbers No financial terms were disclosed. Venezuela shipped 1.08 million barrels a day of crude in September, 629,000 to the US, tanker data cited by Caracas daily El Nacional show.
- —What it means for you Nothing changes yet for US fuel or power prices. For investors, a listed US company is betting on a Venezuelan gas business that has never exported.
- —Still open Which fields and plants come first, the money involved, and whether the US Treasury licenses each project, as the agreement requires.
A Venezuela gas deal signed in Caracas on Monday makes Houston’s Baker Hughes the anchor of a planned gas export chain. For US investors, it puts a Nasdaq-listed American company at the centre of plans for Venezuela’s first gas exports. The oilfield technology group announced the agreements at 7:00 a.m. US Eastern time.
Its partners are the state oil company PDVSA and two US firms, the Houston engineering contractor Lindsayca and the developer Fulcrum LNG. The stated goal is gas for Venezuela’s power plants first and liquefied natural gas (LNG) exports later.
What Baker Hughes Signed
The main document is a strategic alliance with PDVSA, Lindsayca and Fulcrum. Baker Hughes said it will lead to project-specific agreements to process, transport, sell and export natural gas.
A second document is a memorandum of understanding with New Stratus Energy, a Canadian company. It covers support for future oil and gas prospects, with Baker Hughes supplying drilling, production and processing technology.
Baker Hughes called the package a framework that links gas fields, pipelines, sales and LNG. The statement gave no financial terms or investment figure.
Simonelli said a central aim is to turn Venezuela’s gas into reliable domestic supply and future exports. He mentioned the potential to export “the first LNG molecules produced in Venezuela.”
Jesús Bronchalo, Fulcrum’s chief executive, set out the order of work. In the near term the partners will upgrade infrastructure to meet PDVSA’s own gas needs and supply power generation.
Only over the medium and long term, he said, will they assess new open-access pipelines and LNG plants. That sequence puts domestic gas and power supply ahead of export cargoes.
Gas Venezuela Burns Instead of Selling
Venezuela’s gas problem is not a lack of resources. The US Energy Information Administration (EIA) put proved reserves at 195 trillion cubic feet in 2023, the largest in South America.
About 80% of the gas comes up alongside crude, and about 30% is reinjected into oil fields, the EIA says. Much of the rest is flared, making Venezuela one of the world’s largest gas flarers.
Industry estimates cited by the EIA put flaring at around 706 billion cubic feet in 2022. That was more than all the gas Venezuela sold that year.
The waste sits beside a weak power grid that suffers frequent outages. Capturing gas now burned off could feed power plants, which is why the partners put domestic supply first.
The Venezuela gas deal follows the meeting covered in Venezuela Baker Hughes Talks Focus on Gas Projects. Other foreign groups are rethinking gas positions too, as reported in Eni and Repsol Weigh Partial Sale of Perla Gas Field.
Crude Already Flows to the United States
The gas push comes as Venezuelan crude is already heading north in volume. Exports fell to 1.08 million barrels a day in September from 1.19 million in August, tanker-tracking data reported by El Nacional and Panorama show.
Shipments to the United States rose over the same period, to 629,000 barrels a day from 553,000. Chevron, PDVSA’s largest joint venture partner, shipped about 283,000 barrels a day, nearly unchanged.
Trading houses such as Vitol and Trafigura pressed PDVSA for discounts as freight costs rose, El Nacional reported. Sales to Europe dropped to about 86,000 barrels a day from 260,000.
Gas is a harder business than crude. Oil can be loaded onto any tanker, while gas needs pipelines, processing plants and, for export, a liquefaction terminal.
The Conditions Attached
Baker Hughes stressed that the alliance is a cooperation framework, not a set of contracts. Each project needs its own definitive agreement and each partner’s internal approval.
Each project must also comply with US sanctions and export controls. That includes licences from the Treasury’s Office of Foreign Assets Control (OFAC), the agency that polices sanctions.
Baker Hughes says it has worked in Venezuela for more than 60 years. Its equipment there includes over 1,200 oil production systems and about 240 turbomachinery units at 23 sites.
That installed base could shorten the path to the first upgrades. The steady flow of crude licences since January suggests Washington is open to US firms working with PDVSA.
What It Means for You
For US drivers and power users, nothing changes yet. No gas will flow under the alliance until each project has a contract, financing and a US Treasury licence.
For investors, Baker Hughes trades on Nasdaq as BKR and gave no revenue estimate for Venezuela. Any return depends on Washington keeping sanctions policy open to work with PDVSA.
For gas buyers, Fulcrum described LNG exports as a medium to long term goal. US and European importers should not expect Venezuelan cargoes soon.
What Is Not Known
None of the companies has named the gas fields, plants or pipelines that would come first. No investment figure, production target or start date has been published.
It is also unclear whether OFAC will need new licences or can rely on existing ones. Nor is it clear what stake PDVSA would hold in any new gas plant.
What did Baker Hughes sign in Venezuela?
On 5 October 2026 it announced a strategic alliance with PDVSA, Lindsayca and Fulcrum LNG to develop gas infrastructure. It also signed a memorandum with New Stratus Energy on future oil and gas projects.
How much is the Venezuela gas deal worth?
No figure was disclosed. Baker Hughes published no financial terms, and each project still needs its own definitive agreement and approvals.
Does the deal need US government approval?
Yes. Baker Hughes said every project is subject to US sanctions and export controls, including authorisations from the Treasury’s Office of Foreign Assets Control.
Sources: Baker Hughes statement, 5 October 2026; Banca y Negocios; Panorama on September exports; EIA Venezuela country analysis.
Editorial responsibility: Matthias Camenzind, Editor-in-Chief · Editorial standards · Report an error
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