The Daily Journal — Petróleos de Venezuela (PDVSA) President Héctor Obregón said Monday that the oil agreement with the United States involves three parties and allows renewals for as long as necessary. However, the underlying contract sets an initial 25-year term.
“The contract has a 25-year term, but legally, by mutual agreement, the parties can renew it for similar periods for as long as appropriate,” Obregón explained during an interview with radio station Onda La Superestación.
The official added that “it initially provides for 25 years, but the parties can renew it as many times as necessary,” and expressed his hope that “for Venezuela’s well-being, oil will continue to serve as a source of prosperity for 100 years.”
Obregón explained that the agreement involves three parties because the U.S. government holds a 35% equity stake in North American Blue Energy Partners (NABEP). This private company signed the contract with Venezuela.
“There is a component whereby, although a company such as NABEP and PDVSA signed the contract, the U.S. government is one of NABEP’s shareholders,” he said.
The PDVSA chief defended businessman Alejandro Betancourt, who has ties to NABEP and has previously faced investigations over alleged money laundering in several countries.
The agreement calls for $100 billion in investment over the next 25 years to rebuild oil infrastructure that Obregón described as “virtually nonexistent today.” The official characterized the bilateral relationship as a “win-win relationship” for both countries.
Regarding sovereignty over the resources, Obregón insisted that Venezuela retains ownership of its reserves. “The reserves remain ours. Of course, Venezuela has enormous reserves, 331 billion barrels, and as the Constitution states, they belong to Venezuela and the Venezuelan people,” he said.
He explained that the country receives benefits not only through a percentage of the barrels produced but also through royalties and income taxes.
“Venezuela not only receives a percentage of the barrels produced, but also collects taxes and fees that allow the Venezuelan government to fund its social programs,” he said.
Regarding the management of the funds, Obregón said PDVSA manages the resources and receives part of the funds through the National Treasury’s account, a measure that he said protects the state-owned company from potential creditor claims.
“PDVSA manages its resources. We have an arrangement agreed upon by the governments, from state to state, to receive some funds in the Treasury’s account. Ultimately, we can even consider this a form of protection because PDVSA currently faces numerous lawsuits, and this prevents creditors from going after its accounts,” he said.
The agreement calls for the development of 17 fields containing total reserves of 65 billion barrels, to reach production of more than 1.5 million barrels per day (bpd). Oil Minister Paula Henao said Sunday that the country currently produces an average of 1.236 million bpd and aims to reach 1.4 million bpd by the end of 2026. In 1998, one year before Hugo Chávez took office, Venezuelan production stood at 3.1 million bpd.
