Machado Backs U.S. Oil Partnership but Questions Venezuela Deal
Venezuelan opposition leader María Corina Machado is backing a long-term U.S. role in developing the country’s oil reserves, even as she questions who has the authority to sign the sweeping agreement announced by acting President Delcy Rodríguez. Machado said Thursday that the scope of the agreement remains unclear, including who is signing it, who will finance it, what guarantees investors would…
Venezuelan opposition leader María Corina Machado is supporting a long-term United States role in developing the country’s oil reserves, despite her concerns over the authority to sign the agreement. The deal, announced by acting President Delcy Rodríguez, covers around 65 billion barrels of Venezuelan crude. Machado, however, questions who will sign it, who will finance it, what assurances investors will receive, and how Venezuelans will benefit.
The agreement is set to last 25 years and involve 17 oilfields, aiming for a production target of 1.5 million barrels per day. The details of the full contract have not been made public. Venezuela currently produces about 1.25 million barrels per day, but much of this oil is extra-heavy Orinoco crude, which requires diluent, upgraded infrastructure, and extensive drilling and workovers before production can increase significantly.
Additionally, Venezuela faces issues such as underinvestment, poor condition of pipelines, power systems, and production facilities, and foreign oil companies still hold large claims from Venezuela’s 2007 nationalizations. The contract will need to endure a change in government, which is crucial for producers considering billions of dollars in investments.
Machado advocates for a partnership between Venezuela and the United States based on rules that can withstand a change in government.
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