US President Donald Trump called the Venezuelan oil deal the biggest in history, as it hands a single company 17 fields with reserves of about 64 billion barrels.
However, implementing the agreements has run into problems, Reuters reports.
The company awarded the contract is the little-known North American Blue Energy Partners, led by Venezuelan businessman Alejandro Betancourt, who was previously investigated by the United States over money laundering. Under the terms of the deal, the US receives a 35% stake in the parent company and the right to buy a fifth of output at cost. Company representatives promise to quadruple oil production to more than 1 million barrels a day.
But experts, contractors and oil workers consider such plans unrealistic. They say the company has accumulated debts to contractors, is facing a shortage of skilled staff and is trying to restore neglected infrastructure. In addition, the reserve volumes cited by Trump may be exaggerated, as over the 25 years of leasing permitted by law it would be feasible to develop only about 10 billion barrels. Former Venezuelan energy minister Humberto Calderón Berti said the deal would not last long because the company lacks experience and technical capacity.
For now, North American Blue Energy Partners is trying to recruit staff urgently and is bringing in local contractors to carry out repair work. The country’s overall oil output has for a long time remained at around 1.2 million barrels a day, and most idle wells need to be restored. Opposition leader María Corina Machado noted that the contract lacks sufficient transparency, although interim president Delcy Rodríguez and White House representatives are defending the deal.
A serious obstacle for the firm is also its reputation and financing problems. Because of past investigations involving Betancourt, the company was unable to open bank accounts for a long time. Problems are also arising in dealings with the American side. When the first oil tanker arrived in Texas, Trump called the cargo a gift, after which the company was forced to hand over the shipped crude for free to underscore the deal’s historic significance.