Chevron stock turns to new Venezuela oil and gas agreements

Chevron is preparing agreements that would return a Venezuelan gas field to the government and expand its role in the Orinoco heavy crude belt, according to a The Economic Times report citing Reuters published Thursday, November 12.

Three sources familiar with the preparations said Chevron is expected to sign the agreements on Monday with Venezuela's oil ministry and state-owned PDVSA. The specific terms have not been disclosed, and Chevron and Venezuela's oil ministry had not immediately commented, the report said.

Venezuela targets new investment

The planned agreements form part of Venezuela's push to attract foreign energy companies after reforms to its hydrocarbons law and an easing of sanctions. Chevron would relinquish the Loran gas field, which it previously explored and confirmed as holding more than 7 trillion cubic feet of reserves, while shifting its focus toward the Petropiar project.

The company is in talks to expand Petropiar into the neighboring Ayacucho 8 area in the Orinoco Belt, Venezuela's main heavy-oil region. The move would deepen Chevron's existing position in the country while changing the mix of assets it operates there. The report did not provide project economics or a production timetable for the proposed arrangements.

Stock remains tied to execution

Chevron stock traded at 193.24 euros on Lang & Schwarz at 12:50 CET on Thursday, November 12. The proposed Venezuelan expansion adds a potential upstream growth avenue, but its investment case will depend on the final contractual terms, fiscal conditions and the company's ability to convert the projects into reliable production and cash flow.

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