5-year deal expected to double crude output with 2 Orinoco oil fields.

Signage at a Chevron gas station. Benjamin Fanjoy - Bloomberg

By Kevin Crowley | Bloomberg News

Chevron Corp. plans to invest $7 billion over the next five years through its joint venture partnerships to more than double crude production in Venezuela, the largest financial commitment so far in a U.S. government-led push to revive the Latin American country's oil industry.

Houston-based Chevron won the right to develop two giant oil fields in the Carabobo area of the prolific Orinoco Belt, it said in a statement on Wednesday. The fields, Carabobo 1 and Carabobo-2-South-A, are located next to Chevron's Petro independencia joint venture, in which it has a 49% stake.

"We're building a very formidable position in what we consider to be some of the best geology in the country," Chief Executive Officer Mike Wirth said in an interview. "This is multiple billions of barrels of resource in place."

The deal represents the most significant capital investment by an oil major into the country since U.S. special forces captured its former leader Nicolas Maduro in January.

Venezuela holds the world's largest reserves, but its fossil fuel industry has been worn down by years of mismanagement, corruption and sanctions. The U.S. government separately negotiated earlier this week for a 35% stake in North American Blue Energy Partners, a privately held company granted 100-year concessions in 17 Venezuelan oil fields.

Wirth declined to comment on the U.S. investment in NABEP, but said he appreciates the Trump administration's commitment to "commercial solutions" that will benefit both countries. "The administration recognizes Venezuela's energy resources can be an engine for both American energy security and Venezuelan economic recovery."

He said Chevron has "significant protections" built into the deal to safeguard its investments, but declined to go into detail about the contracts. The company expects to add some of Venezuela's reserves back onto its books after taking a write-off some years ago, he said.

U.S. Energy Secretary Chris Wright said companies are on the cusp of signing a series of deals that will put Venezuela on pace to rapidly expand its output of crude. He spoke after landing in Caracas, where he's expected to meet with acting Venezuelan President Deley Rodriguez and unveil more than a dozen agreements with energy companies.

The Chevron deal is the largest, while Wright said in a Bloomberg Television interview that deals have also already been signed with GE Vernova Inc. and Eni SpA.

Italian energy producer Eni aims to eventually boost production from its Venezuelan operations to more than 1 million barrels a day, a figure that includes volumes from state-owned Petroleos de Venezuela SA, according to people familiar with the matter.

Chevron expects to be producing about 600,000 barrels of oil a day from Venezuela by 2031, more than double its current levels. The country's deep resource potential will last for "decades," and total costs are expected to be less than $20 a barrel, the company said in the release.