Venezuela seeks more investment in energy sector as it reforms hydrocarbon law

Venezuela is actively seeking additional international investment in its energy sector, with the partial reform of the hydrocarbon law marking a "paradigm shift," according to the country's hydrocarbons minister, Paula Henao. Speaking at Adipec in Abu Dhabi, Henao explained that the new framework permits private involvement in primary activities through mechanisms such as production and exploration contracts, providing guarantees like dispute resolution and alternative frameworks that enhance conditions for attracting investment.

The oil-rich nation has been struggling for years due to sanctions that have curtailed investment inflows. Since the ousting of President Nicolas Maduro in January, Venezuela has been striving to attract more investment, a goal that has been bolstered by the removal of President Maduro and the subsequent takeover of the country's oil industry by the US administration.

Henao emphasized that despite ongoing challenges, including sanctions, Venezuela has signed 80 commercial agreements with international companies over the past year.

Recent examples include Venezuela's signing of an energy agreement with France's TotalEnergies in September; US firm Chevron plans to invest $7 billion over seven years to double its oil production to 600,000 barrels per day; while North American Blue Energy Partners aims to invest up to $100 billion across 17 Venezuelan oil projects.

Additionally, US oil producer Continental Resources signed a memorandum of understanding with the state-owned company PDVSA to jointly develop the Ayacucho 2 block in Venezuela's Orinoco Belt, one of the world's largest reserves of heavy crude.

Venezuela, an Opec founding member, boasts the world's largest proven oil reserves and currently produces approximately 1.1 million barrels of crude oil daily. While the country's oil exports constitute only about 1% of global oil trade, more than 67% of that output is classified as heavy crude.