Star Metro - US energy secretary in Venezuela to sign Trump's 'biggest' oil deal

Wright is in Venezuela to seal the deal with the country's interim president Delcy Rodriguez, who has been under pressure to grant the United States a chunk of her country's oil wealth.

Ahead of the meeting Wright told CNBC that Venezuela's oil production would top 2 million barrels per day by the end of the decade, double the output in January, when US forces toppled former president Nicolas Maduro, putting Rodriguez in charge.

President Donald Trump bills it as the "biggest oil deal in world history."

It would still be far off the 3 million barrels per day Venezuela was producing at the end of the 20th century.

Chevron meanwhile announced a separate $7 billion deal with Venezuela to develop two additional oil fields in the country's Orinoco Belt, more than doubling output in five years. Chevron is the leading private oil producer in Venezuela.

CEO Mike Wirth told CNBC the stepped-up investment reflects greater assurances of foreign investment since the ouster of Maduro.

Trump has presided over a steep rise in US fuel costs as a result of his war against Iran and his Republican Party looks likely to lose at least partial control of Congress in November midterm elections.

Wright told reporters in Caracas that the investments would bring "peace, opportunity and prosperity to the people of Venezuela and to the people of the United States."

But the biggest of the deals -- the agreement giving the United States majority control of 65 billion barrels of Venezuelan oil reserves -- has raised major legal and political questions.

Critics have accused Rodriguez of signing away Venezuela's resource sovereignty and highlighted the role played by a controversial businessman acting as a go-between.

The deal is a major about-turn for the "Chavismo" movement of late socialist firebrand Hugo Chavez, who nationalized Venezuela's oil fields two decades ago before being succeeded by his ally Maduro.

Rodriguez's government, which has been eager to comply with Washington's agenda since Maduro's capture and extradition to the United States, has argued that the deal will help Venezuela unlock its energy potential.

"Who benefits from this oil if it stays underground?" National Assembly chief Jorge Rodriguez, the brother of Delcy Rodriguez, asked.

Trump on Tuesday wrote on social media the plan is part of "unleashing American Energy Dominance!"

- Pushing out Russia, China -

The deal granting the US preferential access to 17 oil fields will notably see the takeover of facilities previously run by Russian and Chinese companies.

Venezuela's Defense Minister Gustavo Gonzalez Lopez gave the deal full military backing, describing it as "prosperity and well-being for the country."

One of the most controversial aspects is the involvement of Alejandro Betancourt, a Venezuelan businessman linked to shady dealings under the late Hugo Chavez's socialist administration.

Betancourt runs North American Blue Energy Partners (NABEP), Venezuela's second-largest private oil company, in which the US government is taking a 35 percent stake under the deal.

He was accused of involvement in a corruption scheme at Venezuela's state-run PDVSA oil company.

But a US official said Betancourt was a "proven operator," while acknowledging that geopolitics sometimes involved dealing with "imperfect" characters.

"I'm not nominating anyone for sainthood here. What I am telling you is that this is a person that, in the past, has been helpful to the United States government," the official added.

Under the deal, NABEP will grant Washington the right to buy 20 percent of the oil pumped by the firm at production cost, the White House said.

Washington will have effective control over NABEP, the official said.

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F.T. Michaud--SMC