The most strategically valuable assets in Venezuela’s oil reopening may not be the country’s estimated 303 billion barrels of proved reserves. They may be a handful of lighter-crude fields needed to blend, transport, and sell the extra-heavy oil concentrated in the Orinoco Belt.
Exxon Mobil, Chevron, and other producers have been competing for access to two areas near El Furrial and Punta de Mata in Venezuela’s Monagas state, according to The Wall Street Journal. Those fields produce lighter crude that can serve as a diluent for Venezuela’s heavier grades, giving them importance beyond their standalone production.
The negotiations have stalled as companies seek control of a limited number of projects capable of supporting large investments, the Journal reported. The dispute exposes a gap between the scale of Venezuela’s resources and the much smaller pool of assets that can compete for capital under the country’s current legal, fiscal, and operating conditions.
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The US Energy Information Administration estimates that Venezuela holds about 303 billion barrels of proved crude reserves, most of them heavy deposits in the Orinoco region.
The Trump administration has pressed energy companies to direct as much as $100 billion into rebuilding Venezuela’s oil sector following the January removal of Nicolás Maduro. Seven months later, none of the major US companies has announced a project approaching that scale.
The Journal reported that Exxon pursued rights to several attractive fields but stepped back after the government of interim President Delcy Rodríguez offered only part of the acreage it wanted. A technical team also surveyed Cerro Negro, the heavy-oil project Exxon operated before its nationalization in 2007, and found damage that could require billions of dollars to repair.
The condition of Cerro Negro adds physical risk to Exxon’s unresolved financial history with Venezuela. Exxon says it is owed approximately $984.5 million following international arbitration over its expropriated assets. A US court recognized the payment obligation in 2025.
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ConocoPhillips, which also lost projects during the Hugo Chávez government, has sought about $12 billion in compensation. The company said it had collected $794 million against one arbitration award as of February, with further collection proceedings continuing.
“They have been burned twice,” Baker Institute energy researcher Francisco Monaldi told the Journal. “I imagine this getting to the board and people saying, ‘Didn’t we learn our lesson here?’”
Chevron has a different starting position because it remained in Venezuela through joint ventures with state-owned Petróleos de Venezuela, or PDVSA. Its Venezuelan production has climbed to nearly 300,000 barrels per day since Maduro’s removal, according to the Journal. The increase has come from operational improvements within existing assets rather than a newly approved multibillion-dollar development.
Using OPEC’s secondary-source estimate of 1.07 million barrels per day for Venezuela’s June output, Chevron accounts for roughly 28% of national production. The company’s existing personnel, permits, operating infrastructure, and field data give it an advantage over rivals attempting to return after nearly two decades.
Chevron is nevertheless pushing Venezuela to make its investment rules more competitive, the Journal reported. CEO Mike Wirth said in January that Venezuelan projects would still have to compete with the company’s other global opportunities for capital.
New oil law
Venezuela amended its hydrocarbons law in January to give private operators more autonomy and introduce a revised tax structure. The government then ordered existing PDVSA partners to migrate their contracts into the new system by July 28.
The process has not eliminated deal risk. Reuters reported that negotiations included disagreements over weighted royalty calculations, uncertainty about whether some projects could be revoked, and new requirements for developments to generate their own electricity.
The US Treasury has expanded licences covering Venezuelan oil trading, equipment, services, and specified oil and gas operations. Companies outside the named authorizations can negotiate contingent contracts, but may still require further approval before implementing projects.
The stalled negotiations are producing a divided investment market. PDVSA circulated a list of approximately two dozen production-sharing agreements under consideration, according to the Journal. The list reportedly included Pacific Coast Energy, a privately held California company seeking access to mature fields, including some considered among Venezuela’s most attractive assets.
HKN Energy, Hunt Oil, and Crossover Energy have also reached preliminary arrangements. Reuters separately confirmed that Hunt and Crossover were among the newcomers negotiating contracts, but said their initial agreements were nonbinding. Unlike established PDVSA partners, newcomers were not subject to the July 28 migration deadline.
European incumbents are also advancing defined projects. Eni is negotiating a production-sharing contract covering the Junín 5 field, Reuters reported, where it said production could rise from 12,000 barrels per day to 200,000 barrels per day. Eni has operated in Venezuela since 1998 and already works with PDVSA on oil and gas developments.
OPEC’s secondary sources estimated Venezuelan production at 1.07 million barrels per day in June, while the Venezuelan government reported 1.187 million barrels per day directly to the organization. Both measures show recovery, but output remains between 65% and 69% below the 3.4 million barrels per day Venezuela produced in 1998.
The upstream gains also do not represent a full reconstruction of the country’s petroleum system. Industry experts told Reuters that restoring Venezuela’s refining capacity could require at least $20 billion. Foreign companies have shown little appetite for those plants because US Gulf Coast refineries can already process Venezuelan heavy crude.
