The U.S. government is entering a partnership with North American Blue Energy Partners (NABEP) to develop Venezuelan oil reserves, marking a significant expansion of its involvement in the country’s energy sector. The agreement, announced by President Donald Trump, grants the Pentagon a stake in approximately 20 percent of Venezuela’s oil fields through a joint venture with NABEP, a company owned by Venezuelan businessman Alejandro Betancourt. The deal includes rights to 17 oil fields with proven reserves estimated at 65 billion barrels, many of which had previously been operated by Russian or Chinese entities.

According to U.S. officials, Venezuela’s acting President Delcy Rodríguez authorized the company a 100-year concession to develop the fields, representing a long-term commitment to increase production in the Western Hemisphere. The White House emphasized that the deal comes at no cost to the U.S. government and is designed to unleash Venezuela’s resource potential for the mutual benefit of both countries. Betancourt described the arrangement as a way to tap into Venezuela’s abundant natural resources by harnessing their “untapped potential.”

The Pentagon’s role in the deal is facilitated through its Office of Strategic Capital, which was initially established in 2022 to address weaknesses in the U.S. defense industrial base. Under this arrangement, the U.S. government would receive warrants allowing it to acquire up to a 35 percent passive stake in NABEP’s parent company. These warrants, described as penny warrants, would grant the government the option to purchase shares at a nominal price. Additionally, the U.S. is guaranteed preferential access to 20 percent of the oil produced by the company at production cost, while the State Department holds first refusal rights to purchase the remaining 80 percent. The White House also stated that the government would have veto power over board appointments, with the majority of board members required to be U.S. citizens.

The involvement of the Pentagon in the Venezuelan oil sector has drawn criticism from some lawmakers. Senator Jack Reed, the top Democrat on the Senate Armed Services Committee, condemned the move as an inappropriate use of military power and taxpayer funds, calling for a comprehensive review of its legal and financial implications.

Alejandro Betancourt’s role in the deal has raised concerns due to his contentious reputation. He has faced investigations in Spain and Switzerland related to allegations of money laundering and tax fraud but has not been formally charged. Betancourt primarily resides in the United Kingdom, where his foreign travel has been restricted due to an extradition agreement. Despite this, U.S. officials reportedly sought to facilitate his involvement by lobbying European governments for leniency.

While the agreement is touted by the Trump administration as a landmark energy initiative, analysts caution that it could take years before production ramps up sufficiently to yield significant output. The deal’s political and legal complexities also pose challenges, given Venezuela’s fraught international standing and the history of foreign interference in its oil industry. Nonetheless, this partnership represents a notable shift in U.S. strategy in the region, blending defense-related investment mechanisms with energy sector development.