The White House revealed on Monday that Venezuela has granted the company North American Blue Energy Partners (NABEP) 100-year concessions for 17 oil fields.
On Monday, the White House released the terms of the deal, which came days after Washington and Caracas reached an agreement that gave the former partial control over Venezuela's oil reserves.
NABEP, a privately held oil company, is the second-largest Venezuelan oil producer and a proven operator, and will pay around $200 billion in royalties and taxes over the first 25 years, the White House revealed.
The Venezuelan oil fields have been granted to a private company; the US is creating a joint venture with NABEP, which is owned by Venezuelan tycoon Alejandro Betancourt.
A plan has been set up by the NABEP to rapidly scale up the production of oil from the oilfields they will be controlling, for which the company plans to invest around $100 billion to build new oil infrastructure in the country, which will not only help drive up economic growth but also support thousands of high-paying jobs in the country. The White House claimed that this would also lead to tens of billions in broader economic activity, Reuters reported.
The concessions being granted to the company are in accordance with Venezuela's hydrocarbon laws, the White House also said.
The US State Department has been granted the right of first refusal to purchase 80% of the oil that NABEP will produce. It will guarantee a purchase of 20% of the output at cost, according to the White House.
The Pentagon's Office of Strategic Capital has been granted a 25% stake in the equity of its corporate parent, as per Reuters.
Since his January military intervention in Venezuela, in which US forces captured former president Nicolas Maduro and his wife from the presidential palace, US President Donald Trump has been pushing to boost oil production in the country.
The White House is claiming that this new deal would come “at zero cost,” while the government will have veto powers on the board members (most of whom will be US citizens) of the private entity being formed.
“NABEP will have reputable U.S. auditors, lawyers, and advisers and the U.S. government’s agreement with NABEP is governed by U.S. law and is subject to the jurisdiction of US courts,” the White House said in a fact sheet about the deal.
