White House Publishes Venezuela Oil Deal Terms as Trump Says Exxon Is Going In
VENEZUELA · ENERGY
Key Facts
—The terms: A White House fact sheet published late Monday lays out the Venezuela oil deal terms: private firm North American Blue Energy Partners (NABEP) gets a 100-year lease on 17 oilfields holding about 65 billion barrels of reserves.
—The US stake: The United States takes a 35 percent equity stake in the corporate parent, a guaranteed 20 percent of the oil produced, and a right of first refusal to buy all remaining output.
—The Exxon surprise: President Donald Trump said ExxonMobil is among the companies “going in” — a reversal after he threatened to shut the major out in January. Exxon declined to comment.
—The middleman: NABEP, controlled by Venezuelan businessman Alejandro Betancourt, will take over fields previously run by Chinese companies and a Russian firm. It now pumps about 170,000 barrels a day and aims for more than a million.
—The doubts: Lawyers question the deal’s legality and duration, and oil majors are uneasy about sharing the table with Betancourt — and with the US government as a shareholder.
The White House has published the terms of its sweeping Venezuela oil deal: a 100-year lease on 17 oilfields for a little-known private partner, a 35 percent US government stake and a guaranteed fifth of all output. Trump says ExxonMobil is going back in. The fine print explains why the majors are still hesitating.
What the White House published
The fact sheet released late Monday puts numbers on the umbrella agreement that Caracas and Washington announced on Friday. North American Blue Energy Partners receives a 100-year lease on 17 Venezuelan oilfields. Together they hold about 65 billion barrels of reserves. That is roughly a fifth of the country’s total — the largest proven reserves in the world.
In return, the United States gets three things. First, a 35 percent equity stake in the corporate parent company. Second, a guaranteed 20 percent of the oil produced. Third, a right of first refusal to buy everything else. The Wall Street Journal had reported how the stake will be built. The Pentagon’s Office of Strategic Capital would use “penny warrants” — instruments that give the government equity without significant upfront capital.
Venezuela’s interim president Delcy Rodríguez negotiated the deal with US Secretary of State Marco Rubio and Defense Secretary Pete Hegseth. The Department of Energy was excluded from that phase. A signing ceremony is expected in Caracas later this week. Chevron, GE Vernova, India’s ONGC, Italy’s Eni and Colombia’s GeoPark are also on track to announce projects. Total output under the agreement should grow to as much as 1.5 million barrels a day. Venezuela currently pumps roughly 900,000.
“We have Exxon going in”
“We have Exxon going in, we have Chevron going in, we have our big oil companies going in, and everybody’s bidding,” Trump told reporters in the Oval Office on Monday. The United States, he added, is already taking out “millions and millions of barrels of oil” for refineries in Texas and Louisiana. “We’re making a fortune, and they’re making a fortune.”
An ExxonMobil return would be a striking reversal. The company left Venezuela after Hugo Chávez nationalised its assets in 2007. It was the second expropriation in its history there. In January, chief executive Darren Woods called the country “uninvestable” under current legal conditions. Trump answered that he was “probably inclined to keep Exxon out”. The company sent a technical team to assess fields in March and has said little since. On Monday it declined to comment. ConocoPhillips is still owed roughly US$12 billion from the same nationalisation era. It said its decisions would depend on factors including policy stability.
Chevron is in a different position. It never left Venezuela. It produces about a quarter of the country’s output through joint ventures. And it is negotiating to add at least one block in the Orinoco Belt, the vast extra-heavy crude region.
Who is North American Blue Energy Partners?
NABEP was previously owned by US oil trader Harry Sargeant. Today it is controlled by Alejandro Betancourt, a Venezuelan businessman. US and European authorities have investigated him over past dealings with Venezuelan officials. He has never been charged and has denied the allegations. The company currently produces about 170,000 barrels a day and has been a PDVSA partner for years. It says it aims to pass one million barrels a day. Under the new structure it receives 14 contracts. These include fields previously operated by Chinese companies and a Russian firm.
That choice of partner is the industry’s central unease. Executives negotiating their own contract migrations “do not want to be at the same table” as Betancourt, one participant in the preparations told Reuters. And the 35 percent US stake means Washington itself becomes a shareholder-competitor. “You would need a sizable amount of investment and expertise from companies like Exxon or ConocoPhillips,” said Alejo Czerwonko, chief investment officer for emerging markets at UBS. “How do you attract these companies to the country?”
Legal doubts and the reserve question
Venezuela’s hydrocarbons law allows only two production models: joint ventures and production-sharing contracts. It is unclear which one NABEP will use. Lawyers warn the pact could end up in court. They point to its 100-year duration, the lack of approval by other institutions in either country, and the absence of a competitive selection process. A recent reform removed the National Assembly’s mandatory oversight of energy contracts marked as being in the national interest. So the full text may never be published.
Part of the American 20-percent output right is earmarked for the US Strategic Petroleum Reserve. That emergency stockpile sits in salt caverns in Texas and Louisiana. It held 289.7 million barrels in mid-August — 41 percent of capacity and the lowest level since 1983. Trump has promised the refill will begin “very soon”. He also says Venezuelan supply will bring down US gasoline prices, without giving a timeline, as The Rio Times reported on Sunday. Caracas says the state will receive about US$19 per barrel and US$209 billion in taxes over 25 years. With Brent back above US$90 after renewed US-Iran strikes, every barrel matters more — for both treasuries.
Frequently asked questions
What are the published Venezuela oil deal terms?
A 100-year lease on 17 oilfields with about 65 billion barrels of reserves for North American Blue Energy Partners; a 35 percent US equity stake in the parent company; a guaranteed 20 percent of production for the US; and an American right of first refusal on all remaining output.
Is ExxonMobil really returning to Venezuela?
Trump says so: “We have Exxon going in.” ExxonMobil declined to comment. The company was expropriated twice and its CEO called Venezuela “uninvestable” in January, so confirmation is pending.
Who controls NABEP?
Venezuelan businessman Alejandro Betancourt, previously investigated by US and European authorities but never charged. The company pumps about 170,000 barrels a day and aims for more than a million.
How does this affect the US Strategic Petroleum Reserve?
The US negotiated rights to 20 percent of the fields’ output, part of which is earmarked to refill the reserve, which stood at 289.7 million barrels in mid-August — 41 percent of capacity, the lowest since 1983.
Is the deal legal?
Contested. Venezuela’s oil law allows only joint ventures or production-sharing contracts, and lawyers question the 100-year term and the lack of a competitive process. A recent reform removed parliamentary oversight of such contracts.
Sources: Reuters (via MarineLink and World Energy News); White House fact sheet; Wall Street Journal; US Energy Information Administration; Univision.
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