WASHINGTON/HOUSTON, Sept 16 - A significant U.S. investment into Venezuela's oil sector is expected this week, U.S. Energy Secretary Chris Wright told Fox News. The announcement, he said, involves a U.S. oil and gas producer that will unveil a major commitment to the OPEC member on Wednesday.
Energy industry observers have noted a wider shift in Venezuela's upstream landscape. Foreign producers are moving to amend or migrate joint ventures and production sharing contracts as part of a broad energy reform program in the country. That transformation has coincided with interest from new entrants, many of them based in the United States, which are signing on to development projects. Officials cite a Washington-supported $100 billion plan intended to rebuild the Venezuelan oil industry as a key factor encouraging those commitments.
Oklahoma City-headquartered Continental Resources, the oil company founded by billionaire Harold Hamm, is among the firms expected to make an announcement. Bloomberg News reported that Continental is likely to disclose a deal to invest in Venezuela at the G20 energy summit being held in Houston. Continental Resources did not immediately reply to a request for comment on the reported plans.
Alongside prospective announcements from U.S. producers, other companies have confirmed deals. Florida-based Denarius Holding Group - whose principal shareholder is Turkey's energy firm Can2 Termik - said on Wednesday that it had reached a 20-year agreement to operate an oil project in Venezuela. The statement from Denarius indicates longer-term contractual arrangements are emerging in the country as part of the sector's reopening to outside investment.
The developments described by the energy secretary and reported by market outlets reflect an active period of deal-making and contract realignment in Venezuela's oil industry. They highlight both the interest of U.S.-linked companies in Venezuelan projects and the role of a large, Washington-endorsed reconstruction plan in shaping investment decisions.
Context and next steps
- The expected announcement at the Houston summit will provide details on the scale and structure of the U.S. producer's investment.
- Market participants will watch for confirmations from Continental Resources and other firms involved in talks with U.S. officials.
- Reports indicate a combination of contract migrations by incumbent foreign producers and new long-term operating agreements by incoming firms.