Venezuela’s opposition has drafted a proposal to reform the country’s energy sector, aiming to attract international oil companies and increase pressure on President Nicolás Maduro, Reuters reported this week. The reform plan aims to gain support from U.S. oil companies and the U.S. government, particularly after the recent cancellation of Chevron’s license to operate in Venezuela.
The proposal, which seeks to amend Venezuela’s hydrocarbon law, offers greater opportunities for foreign companies to participate in the country’s energy sector. It includes plans to reduce the size of state-owned Petróleos de Venezuela, S.A. (PDVSA) and open up Venezuelan oil fields, refineries, and midstream assets to private bidding.
“Venezuela is opening its energy sector to the world, offering unprecedented investment opportunities and a clear, rules-based framework for private sector leadership,” the proposal states, as reported by Reuters.
The proposed reform aims to raise Venezuela’s oil output above three million barrels per day (bpd), a level not reached in 15 years, while last year’s output was only 920,000 bpd. It also offers better contract terms for PDVSA partners, including a lower government share.
The opposition’s plan includes adding international investment protection standards to Venezuela’s laws. This comes amid ongoing legal issues and debt defaults, especially from the nationalization of the oil industry under Hugo Chavez. Venezuela’s political instability, nationalist policies, and U.S. sanctions have discouraged investment, despite holding the world’s largest oil reserves.
