Venezuela is preparing to award new oil exploration and production blocks to Chevron and Spain’s Repsol, signaling a cautious reopening of the country’s energy sector. Officials in Caracas could finalize the agreements as soon as this week.

The move comes amid a shift in U.S. policy, with Washington encouraging select international oil companies to help restore Venezuela’s oil output while maintaining broader sanctions pressure. Earlier this month, the U.S. Treasury issued General License 46A, allowing long-established American firms to engage in certain oil-related activities involving Venezuelan crude without violating sanctions.

U.S. Energy Secretary Chris Wright, during a visit to the oil-rich Orinoco Belt, described the potential for collaboration between U.S. companies and Venezuelan resources as “limitless,” highlighting the opportunity to revive the country’s struggling oil industry.

Chevron, currently the only major Western oil producer operating in Venezuela under special authorization, accounts for a significant portion of the nation’s limited output. Repsol maintains gas-focused interests, including offshore projects like the Cardón IV project in partnership with Eni, supplying fuel to Venezuelan power plants.

Once a global oil powerhouse, Venezuela’s production has plunged over the past decade due to mismanagement, corruption, and sanctions, falling to roughly one million barrels per day less than a third of its 1990s levels.

Industry analysts say the new blocks could boost output and signal confidence to other international players considering a return, should regulatory and sanctions conditions continue to ease.