WASHINGTON -- Oil giant Chevron is planning to expand its operations in Venezuela, a U.S. official said Tuesday, just days after President Donald Trump announced an ambitious deal to develop the nation's oil reserves and give the Pentagon a stake in the profits.
The official, who briefed reporters on the expected announcement, said the company’s officials and Energy Secretary Chris Wright are expected to visit Venezuela on Wednesday where the new investment will be formally unveiled. The official spoke on condition of anonymity under ground rules set by the White House for the call.
Chevron is the second-largest U.S. oil company and the only one with a major presence in Venezuela. Chevron did not immediately respond to a request for comment.
The announcement comes after the White House confirmed on Monday it is partnering with North American Blue Energy Partners (NABEP) as part of President Donald Trump ’s push to tap into Venezuela’s oil industry.
The sweeping agreement has been met with skepticism from analysts who say it will take years to revive Venezuela’s production. They have questioned whether Venezuela’s acting President Delcy Rodríguez has the legal authority to give the company 100-year rights over 17 oil fields with reserves of 65 billion barrels — and whether future Venezuelan or American administrations would overturn the agreement.
NABEP, owned by Venezuelan businessman Alejandro Betancourt, is already the second largest operator in Venezuela. The deal with the U.S. government would create a new company, where the Pentagon would take a 35% ownership stake, and the State Department would have the right to buy 20% of the oil produced at cost.
The U.S. administration sought to defend its decision to partner with Betancourt, who has faced criminal investigations for alleged money laundering in Spain and Switzerland, according to multiple media reports. No formal charges were ever filed. The official said that Betancourt was vetted and the administration found that “no U.S. laws were violated.”
At the same time, the official described Betancourt as the only viable partner available for the job, saying that “you have to work with the factors that you have in place.”
The U.S. government is not investing money in the new company, the official told reporters, but its backing will help the company attract investment to ramp up production.
Analysts say that the deal seems certain to face legal challenges and potentially questions of legitimacy. The Trump administration negotiated the agreement with Rodriguez, who took power after the January military operation to capture Nicolás Maduro and spirit him to the United States to face federal narcoterrorism and drug trafficking charges.
The Venezuelan Constitution states that contracts of this kind with foreign governments must also be approved by the National Assembly, which did not occur.
But the official said that agreement is a partnership with North American Blue Energy Partners, a private entity which is headquartered in Barbados and has its primary regional office and operations in Caracas, Venezuela.
The Trump administration wants elections to happen as quickly as feasible, but is aiming to maintain stability as it helps Venezuela transition following decades of autocratic rule, the official said.
The official argued that maintaining stability during such transitions “almost invariably requires you to work with elements of the existing structure, even as you are creating a new one.”
The Pentagon's role in the deal comes through its Office of Strategic Capital, which was created under former President Joe Biden to invest in technology needed for national security.
A second U.S. official speaking on condition of anonymity described the Venezuela agreement as “a very standard deal” and said the office has made several similar ones since Trump returned to office.
Trump has had his eyes on Venezuela’s oil since Maduro’s capture, and his aides call it a path away from reliance on oil from the Middle East. Trump has been pressing to get U.S. businesses to restore a presence in the country. President Hugo Chávez completed the nationalization of Venezuela’s oil industry in 2007, leading major players like Exxon and ConocoPhillips to leave Caracas.
Talking to reporters at the White House on Monday, Trump suggested that other oil companies were readying for business in Venezuela. “We have Exxon going in, we have Chevron going in. We have our big oil companies going in," he said. Trump in January said he was inclined to leave Exxon out of Venezuela after CEO Darren Woods called the country “uninvestable.”
A spokesman for Exxon said Tuesday, “Nothing has changed” on the company’s position regarding Venezuela.
Chevron has been the only major American oil company actively operating in Venezuela since the nationalization.
Trump was scheduled to meet with a group of large and small oil refiners on Tuesday to discuss ways to increase America's capacity to refine oil into gasoline.
The White House has said that increasing the number of refineries and expanding the capacity at existing facilities would eventually reduce prices for consumers. The administration also sees the need for more refineries to process oil from Venezuela.
