New Agreement Grants Pentagon Access to 20% of Venezuelan Crude at Production Cost

Deep News09-05 10:20

The U.S. Department of Defense has reportedly secured preferred rights to purchase oil from 17 Venezuelan oil fields under a newly signed agreement, allowing it to acquire 20% of production at extraction cost rather than prevailing market rates.

According to the report, the Pentagon holds an exclusive option to buy crude from NABEP's operations. Under the terms, 20% of output may be acquired at a price reflecting the company's production expenses, while the remaining volume is purchased at market prices.

Beyond the access to discounted crude, the Pentagon has also obtained a 35% equity stake in the joint venture, the report notes. This ownership position is structured through special rights tied to a nominal share purchase, safeguarding the U.S. share from dilution as the project attracts billions in external investment and enabling Washington to receive dividends from the outset.

The United States and Venezuela previously announced a historic agreement focused on investments in Venezuela and boosting its oil output. Venezuela's acting president, Delcy Rodríguez, characterized the alliance as a mechanism to significantly increase production with private sector participation.

The agreement provides for the development of 17 strategic oil fields with proven reserves of 65 billion barrels. Planned investments exceed $100 billion and are projected to generate more than $200 billion in tax revenue for Venezuela over the life of the project.

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