Published by Global Banking & Finance Review®
Posted on March 10, 2026
6 min readLast updated: April 1, 2026
Add as preferred source on GoogleChevron and Shell are nearing breakthrough oil production agreements in Venezuela—the first since the U.S. captured Nicolás Maduro on January 3—enabled by major reforms and eased sanctions that open the sector to foreign firms.
By Marianna Parraga and Deisy Buitrago
HOUSTON/CARACAS, March 10 (Reuters) - International oil majors Chevron and Shell are closing in on the first big oil production deals with Venezuela since the U.S. capture of President Nicolas Maduro in January, five sources close to the negotiations told Reuters.
The deals would allow both companies to boost production in coveted oil regions in the South American country, the biggest steps to date toward what U.S. President Donald Trump has said would be a $100 billion effort to rebuild Venezuela's oil industry after decades of mismanagement and underinvestment under Maduro and his predecessor Hugo Chavez.
Venezuela's National Assembly in late January approved a sweeping reform of the country's main oil law. It now grants foreign companies autonomy to operate, export and sell Venezuelan oil even when they are minority partners of state-owned oil company PDVSA.
Chevron and Venezuela's energy authorities have agreed on preliminary terms to expand Chevron's largest oil project, Petropiar, in the vast Orinoco Belt, two of the sources said.
Venezuela's oil ministry, PDVSA and Chevron did not reply to requests for comment.
The deal would give Chevron the rights to produce from the Ayacucho 8 area located south of the Petropiar project area, the two sources added, a large block with proven oil resources. This would allow Chevron to make a substantial increase in the extra-heavy oil it produces and exports.
Chevron aims to secure a reduced royalty rate for the new area and other tax and trade incentives offered to companies under the new legislation to develop greenfield oil and gas areas, according to the two sources. PDVSA completed exploration and appraisal in Ayacucho about two decades ago but it remains largely undeveloped.
Chevron and PDVSA could extend their well-cluster production system in Petropiar to Ayacucho 8, allowing them to boost output relatively quickly, the sources added. The project would be Chevron's fifth oil area in Venezuela.
The project could turn Chevron into the biggest private producer in the Orinoco, which holds over three quarters of the country's total crude reserves. Rival U.S. company ConocoPhillips used to be that region's top foreign producer before it left Venezuela two decades ago following a wave of nationalizations.
Chevron and PDVSA were producing around 90,000 barrels per day (bpd) of upgraded Hamaca crude and 20,000 bpd of vacuum gasoil at Petropiar last month, according to a PDVSA document seen by Reuters. Venezuela's total production is around 1.05 million bpd.
SHELL PROGRESSES IN OIL, GAS DEALS
Shell signed preliminary oil and gas agreements with Venezuela last week, when U.S. Interior Secretary Doug Burgum was in Caracas. Venezuela's government did not make public the details of those deals and the fields included.
Reuters has learned from an official summary document of the agreements that Shell aims to develop the Carito and Pirital fields in the coveted Monagas North region in eastern Venezuela. These are among the few areas in the country that can produce light and medium crude and natural gas, prized by oil companies that need it for blending to facilitate exports of Venezuela's heavy oil.
Shell confirmed in an email it signed several agreements with the government, engineering companies Vepica and KBR and oil-service firm Baker Hughes, which "formally articulate Shell's intent to progress a variety of opportunities with Venezuela," including offshore gas, onshore oil and gas, exploration, local content and workforce development. It did not disclose the fields or give further details to Reuters.
Monagas North could also fit into Shell's broader strategy focused on natural gas - due to its proximity to the country's onshore gas infrastructure and the areas with the most gas flaring in Venezuela. Shell, M&P and other companies have previously designed plans to minimize gas flaring by building the infrastructure needed to capture it, process it and transport it for export, possibly through Trinidad.
The Punta de Mata area, which includes Pirital, Carito and the nearby El Furrial field, produced some 94,000 bpd of crude and some 1.03 billion cubic feet per day of gas last month, according to independent figures. Of that, some 350 million cubic feet per day were flared.
Shell's only project in Venezuela before the preliminary agreement was announced was the flagship Dragon offshore development near Trinidad. The company has struggled to advance it after the U.S. imposed sanctions on Venezuela's energy sector in 2019. Shell had sold its stake in the flagship Urdaneta Oeste oilfield to French Maurel & Prom in 2018.
PDVSA and the oil ministry are in talks with about a dozen joint venture partners willing to expand operations to neighboring fields, mature areas or blocks marked as greenfields, where infrastructure development is needed.
Among other companies seeking to expand the areas where they have projects so they can boost oil and gas output are Spain's Repsol and M&P, the sources said. Repsol is the foreign partner with the largest debt to recover in Venezuela, with over $5 billion that accumulated under sanctions, the firm said last month.
Chevron and Venezuela's government are also negotiating for the U.S. major to return two untapped offshore natural gas areas to Venezuela at the Plataforma Deltana project on the maritime border with Trinidad and Tobago, which could be reoffered for private investment.
It is unclear what the terms would be for Chevron to give up those stakes. Chevron is focused on oil rather than gas production in Venezuela.
Venezuela in February began a review of all oil and gas projects, starting with production sharing contracts signed by Maduro's administration with l
Chevron and Shell are negotiating new oil production deals, allowing them to boost output in Venezuela following new oil law reforms.
Venezuela's National Assembly passed reforms granting foreign companies greater autonomy to operate, export, and sell oil, even as minority partners.
Chevron aims to expand its Petropiar project in the Orinoco Belt and gain rights to the undeveloped Ayacucho 8 area.
Shell plans to develop the Carito and Pirital fields in Monagas North, regions known for light and medium crude and natural gas.
These deals could significantly boost production and attract foreign investment, supporting efforts to rebuild Venezuela's oil sector.
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