Chevron Bets $7 Billion on Venezuela Oil Expansion

Chevron plans to invest over $7 billion in Venezuela over the next five years, aiming to more than double its oil production in the country to approximately 600,000 barrels per day. This investment follows new agreements with Venezuela that provide the company with improved fiscal, commercial, and legal terms, as well as additional acreage in the Orinoco Belt.

Chevron's three joint ventures in Venezuela will allocate the funds through 2031, ensuring production costs remain below $20 per barrel. Presently, Chevron produces around 290,000 barrels per day in Venezuela, all of which is exported to the United States. In contrast, Venezuela's oil production has dwindled from more than 3 million barrels per day in the late 1990s to between 1.1 million and 1.2 million barrels per day today.

The new acreage includes the Carabobo-1 and Carabobo-2-South-A areas in the Orinoco Belt, held jointly with Petroindependencia, where Chevron holds a 49% stake. Chevron expanded its ownership in Petroindependencia to 49% in April and secured rights to develop the Ayacucho 8 area adjacent to its Petropiar venture. Since the beginning of this year, Chevron's three Venezuelan joint ventures have increased production by 15%.

This announcement provides a dollar figure and production target to the Chevron agreements that were nearing completion earlier this week. These agreements, previously described as "significant size," involved seeking additional Orinoco Belt acreage. Chevron's investment is distinct from Washington's agreement to acquire a majority stake in 17 Venezuelan oilfields containing approximately 65 billion barrels of proven reserves.

President Donald Trump has also urged for around $100 billion in investment to revamp Venezuela's oil industry following the U.S. intervention in removing Nicolás Maduro in January. ExxonMobil and ConocoPhillips have yet to resume operations after their Venezuelan assets were nationalized under Hugo Chávez in 2007.