Chevron and Halliburton are nearing billion-dollar deals to invest in Venezuelan oil

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Executives from several oil-and-gas companies are set to sign production deals in Caracas next week, with Energy Secretary Chris Wright expected to attend

The El Palito refinery of the Venezuelan state oil company PDVSA. (Jesus Vargas/picture alliance via Getty Images)

Chevron $CVX and Halliburton $HAL are close to deals that would commit billions of dollars to Venezuelan oil fields, according to The Wall Street Journal. The agreements would position President Trump for a diplomatic and energy win after months of slow-moving negotiations.

Chevron is on the verge of a deal to bring two heavy-oil fields into its Venezuelan portfolio, the Journal reported, citing people with knowledge of the negotiations. Chevron presently runs three joint ventures with PdVSA, making it the sole large American oil company with an active presence in Venezuela.

Halliburton, among the biggest U.S. oil-field-services companies, is separately in discussions to supply equipment and services to Venezuelan oil producers.

Executives from several oil-and-gas companies are set to travel to Caracas to sign production deals next week. Energy Secretary Chris Wright is expected to make the trip as well.

A significant portion of the fields on offer have never been developed, with many missing basic infrastructure and reliable power. Bringing those fields into production would require billions of dollars in investment.

Chevron's two largest rivals, ExxonMobil $XOM and ConocoPhillips $COP, plan to hold off for now as discussions continue. Both companies are still seeking billions of dollars in restitution after the late Venezuelan leader Hugo Chávez nationalized their assets in 2007.

The country's current output stands at about 1.1 million barrels per day, a pace consistent with what it produced last year.

The Chevron and Halliburton negotiations are distinct from a parallel set of talks in which the Trump administration is pursuing a direct U.S. government interest in 17 of Venezuela's top fields — acreage that collectively contains an estimated 90 billion barrels of proven reserves.

The current talks build on earlier momentum in the sector. Hunt Oil Company and SLB signed agreements with Venezuela earlier this month in Houston, marking some of the first major deals between American oil firms and Venezuela in close to two decades. Hunt Oil was the first company to sign an agreement to pump Venezuelan oil. Those deals came as Venezuelan officials traveled to Houston for an energy conference, with Venezuela's Oil Minister Paula Henao telling attendees that the country has 916 areas available for exploration and production.

President Trump has pushed U.S. oil companies to invest in Venezuela since January, with the goal of increasing oil production in the Western Hemisphere and securing greater flows of heavy oil for American refineries. Venezuela holds some of the world's largest proven oil reserves.

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