US unveils oil partnership with NABEP

The White House on Monday said it is partnering with North American Blue Energy Partners (NABEP) in a deal that will give the Pentagon a stake in Venezuela's oil reserves. The announcement released new details of a plan first unveiled Friday, as President Donald Trump seeks to boost oil production in Venezuela.

Under the agreement, the S. is forming a new company with NABEP, which is already the second-largest operator in Venezuela, according to the White House. The Pentagon will hold a 35% ownership stake in the company, and the State Department will receive a guarantee to purchase 20% of the output at cost, the White House said.

NABEP, owned by Venezuelan businessman Alejandro Betancourt, has agreed to invest $100 billion in new oil infrastructure, the White House said. The S. government will have veto power over board members, the majority of whom will be S. citizens.

In a fact sheet, the White House stated that "NABEP will have reputable S. auditors, lawyers, and advisers and the S. government's agreement with NABEP is governed by S. law and is subject to the jurisdiction of S. courts."

The deal grants the new company 100-year rights over 17 oil fields with proven reserves of about 65 billion barrels. Many of those fields were previously owned by Russian or Chinese firms, according to the White House.

Context of the deal

The agreement comes as part of President Trump's broader push to extract energy from Venezuela, nine months after the capture of then-President Nicolás Maduro on federal narcoterrorism and drug trafficking charges. Trump announced the deal on Friday, describing it as a move that gives the S. majority control over about 20% of Venezuela's oil reserves.

Venezuela's acting President Delcy Rodríguez is granting the company the 100-year rights, according to reports from Vancouver Is Awesome. The White House said the S. government would have the right to purchase, at production cost, a guaranteed 20% of the off-take from all current and future NABEP fields, which would help refill S. strategic petroleum reserves.

The White House claimed the deal would be "at zero cost" to the , but former S. government energy advisers have cautioned that the deal carries political risk, since future administrations in Venezuela or the United States could challenge the agreement.