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Venezuela Signs First New U.S. Oil Contracts — But Majors Still Watch From The Sidelines

Hunt Oil & SLB sign Venezuela’s first new production contracts since Maduro’s removal, as U.S.-bound exports quadruple to over 500,000 barrels a day — but industry giants like ExxonMobil remain sidelined

Venezuela Signs First New U.S. Oil Contracts — But Majors Still Watch From The Sidelines
Venezuela’s state-run oil firm PDVSA in Morichal, July 28, 2011. Credit: Carlos Garcia Rawlins/Reuters

CARCAS — Seven months after Nicolás Maduro’s removal, Venezuela’s oil sector reached a genuine operational milestone this week: American companies signed their first new production-related contracts with PDVSA, even as exports to U.S. refineries have quadrupled since the end of last year — and even as the industry’s largest players continue to stay away.

Dallas-based Hunt Oil Company signed a hydrocarbons production participation contract covering two onshore fields in eastern Venezuela, Caro and Carisito, confirmed Tuesday at a Houston industry showcase by Venezuelan Oil Minister Paula Henao.

Under a participation contract, Hunt bears the costs of developing and enhancing the fields directly and receives a share of whatever they produce, rather than a fixed service fee — a genuine equity-style bet on Venezuelan crude. Hunt CEO Hunter Hunt said the company is “proud to be one of the first American companies to sign an agreement with PDVSA to help expand Venezuela’s oil and gas production.”

Oilfield services giant SLB signed a separate framework agreement to conduct integrated reservoir studies across the country, building on a memorandum of understanding the two parties signed in Caracas in June.

A reservoir study maps a field’s subsurface geology, measures how much oil remains in place, models recovery rates, and identifies optimal well placement — the foundational engineering data companies need before they can commit serious drilling capital.