President Trump has announced what he is calling the biggest oil deal in world history, an agreement that would give the United States majority control over 17 oilfields in Venezuela holding more than 65 billion barrels of proven reserves.
Under the arrangement, the US Department of Defense would take a 35 percent stake in North American Blue Energy Partners, the entity set to operate the fields. Backers of the deal are projecting more than 100 billion dollars in investment and roughly 209 billion dollars in expected tax revenue for Venezuela, with the goal of roughly doubling American oil reserves and boosting domestic supply.
The operator, North American Blue Energy Partners, is controlled by Venezuelan businessman Alejandro Betancourt Lopez, who is currently under investigation in Switzerland. Chevron remains the largest private oil producer already operating in the country, and smaller firms including Hunt Oil are moving to invest, while ExxonMobil and ConocoPhillips have so far stayed on the sidelines. On the Venezuelan side, interim President Delcy Rodriguez, who took power after Nicolas Maduro was removed from the country earlier this year, has been positioning herself as willing to work with Washington on economic matters like this one.
The size and structure of the deal have drawn sharp criticism from analysts who see echoes of an earlier era of resource extraction. Gregory Brew of the Eurasia Group said plainly that if the arrangement in Venezuela sounds colonial, that is because it is. Critics point to the deal's concentration of control among politically connected businessmen tied to both governments as evidence that it functions more like an insider arrangement than a conventional energy partnership.
Even supporters caution the deal faces real obstacles before it can deliver on its promises. Analysts note it could take years to produce meaningful results and may not survive a change in leadership in either country. There is also a technical wrinkle: Venezuelan crude is not compatible with the facilities that make up the US Strategic Petroleum Reserve, complicating one of the deal's stated goals of shoring up American reserves.