Nicolás Maduro turns to international energy companies looking for deals that will ease the crisis

Venezuela’s interest in the resources of international energy companies and Venezuelan oil and gas became evident after the United States eased sanctions on Caracas, which has since signed agreements with at least four foreign companies, and value collaboration with another.

On December 18, two months after the United States announced the flexibility, Venezuelan state-owned PDVSA signed an agreement with the Spanish multinational Repsol and in the following days it did the same with the Korsou Refinery (RDK) of Curacao and with the National Gas Company of Trinidad and Tobago.

These companies have joined the French company Maurel & Prom, with which PDVSA agreed in November to reactivate a joint venture.

Additionally, India announced that it will purchase crude oil from Venezuela, which was the Asian country’s third largest oil supplier in 2020, while PDVSA is studying a collaboration with the Mexican state company Pemex.

The need for international aid

Economist Luis Vicente León told EFE that the “hyperbroad” flexibility, which “allows Venezuela to export” and “collect oil and gas anywhere in the world”, although it represents “an advantage” for Nicolás Maduro’s government, is also a “victory” for the United States and the entire West, given the global “energy need” due to the current geopolitical conflict.

“Today there is a need for oil, today there is a need for gas. Although one might predict that, in the coming years or decades, oil will lose importance as an energy source, today it still represents around 80% of all energy supply is still a fossil,” he said.

And that energy, he continued, “is found in inconvenient countries”, including – he observed – Venezuela itself.

In his opinion, foreign companies not only “want to produce” in the South American country, but also “would be happy if the rest” of the companies “delayed” in “establishing agreements with PDVSA” and “producing the maximum number of fields” and “colonizing the spaces”.

León, president of the polling firm Datanalysis, said that Venezuela “needs investments to recover its oil industry”, which is “very deteriorated”, with a “weakened production capacity”, technological backwardness and a lack of human talent to due to immigration.

However, the expert assures, PDVSA “does not have sufficient resources” for this, and his “financial needs” are “very great”.

But now the country, whose main source of income is oil, will “improve its cash flow” through the payment of taxes, dividends and benefits from foreign energy companies, which have a minority stake in joint ventures with PDVSA .

Furthermore, the Venezuelan state company, which exports “directly” between 200,000 and 300,000 barrels per day (bpd), according to León’s calculations, will be able to sell its crude oil at market prices and not with discounts, as they were “40% “.

American sanctions

The easing of sanctions expires in April“political prisoners”, an issue on which progress has been made this month.

The government released around thirty people, including 10 Americans, in exchange for the freedom of Colombian businessman Alex Saab, a close collaborator of Maduro, detained in Miami, accused of conspiracy to launder money.

However, economist and oil expert Luis Oliveros told EFE that he considered the reinstatement of sanctions “quite difficult”.

“The chances that the sanctions will return are quite low. In its way, with its pace, with its style, the Maduro government has respected what the agreements say,” the expert said.

According to analysts, the releases and the easing of sanctions, as well as a recent agreement on deportation flights, are part of the a “negotiation process” between the two countriesno relationship since 2019.

Last December 20, US President Joe Biden said that Maduro “continues” with his commitment to holding “free” elections.

Among the reasons that could favor the extension of the lifting of sanctions, Oliveros underlined the global need for oil, whose largest reserves are found in Venezuela, and the debts that this country has with companies such as the American Chevron, which has taken over operations in this country. country at the end of 2022 and Repsol, among others.

Source: EFE