Venezuela’s state oil company, PDVSA, has signed at least nine new oil contracts with foreign firms — including Chinese companies — to sustain crude production and revenue flow after U.S. sanctions forced Chevron to end operations in the country.
The deals, a shift from traditional practice, grant the partners the right to operate pre-drilled wells and exclusively sell the output — a major departure from PDVSA’s historical monopoly on oil trading.
Chevron’s license to operate in Venezuela expired in early April, with a deadline of May 27 to complete all exit operations. This marked a major blow, as the American energy giant had accounted for nearly a quarter of the country’s oil production.
“PDVSA has a plan to keep producing oil despite the US’s unilateral coercive measures,” said Venezuela’s Vice President and Oil Minister Delcy Rodriguez on May 29.
Among the new partners are Aldyl Argentina SA and Chinese firms Anhui Guangda Mining Investing Co. and China Concord Resources, according to an internal PDVSA document. However, one U.S. company, North American Blue Energy Partners, has backed out due to licensing challenges.
While PDVSA will retain at least 50% ownership in the oil produced, the foreign firms will handle operations and sales. These new 20-year contracts, signed under President Nicolás Maduro’s controversial anti-blockade law, bypass National Assembly approval and offer tax exemptions, a move critics say undermines Venezuela’s hydrocarbons law.
Energy committee lawmaker William Rodríguez defended the strategy, saying, “The only way Venezuela can maintain and increase its production is by relying on private local and international companies that don’t care about US sanctions.”
Despite past failures, PDVSA is hopeful. It forecasts the new blocks could collectively yield 600,000 barrels a day, backed by $20 billion in investments.
“PDVSA has tried this before with little success,” said Francisco Monaldi of Rice University’s Baker Institute. “But these new terms are far more attractive. The key is offering reliable crude supplies to companies willing to risk trading on the black market.”
With Chevron out, and other U.S. service giants like Halliburton and Schlumberger also barred, Venezuela is betting on non-Western partners to keep its oil lifeline running — and its economy afloat.
