Venezuela: Texan billionaire's company announces an agreement with the state-owned PDVSA a few days after the restoration of sanctions against the Maduro regime

This Wednesday, a company founded by Rod Lewis, a billionaire oilman from Texas, announced an agreement with Venezuela's state oil company. This news comes just a few days after the Biden administration reinstated sanctions against the Venezuelan oil and gas industry.

LNG Energy Group, the company in question, reported that the deal was closed on April 17 while sanctions relief from the United States was still in place. This agreement involves the production and development of two oil fields in eastern Venezuela, which currently generate around 3,000 barrels of crude oil per day, in exchange for between 50% and 56% of hydrocarbon production.

LNG stated that it "intends to operate in full compliance with the applicable sanctions regimes." However, restoring restrictions could pose problems for this agreement.

While the U.S. government has left open the possibility for companies to apply for licenses exempting them from restrictions, few U.S. companies have been willing to invest in Venezuela in recent years due to concerns of government seizure, sanctions and corruption.

"This will be a test of U.S. sanctions whether they get a license or not," said Francisco Monaldi, a Latin American energy policy expert at Rice University's Baker Institute.

It should be remembered that the United States reinstated sanctions against Venezuela on April 18 and only granted a 45-day grace period for companies and banks to complete pending business with Venezuela. This was after Nicolás Maduro failed to comply with the agreement signed in Barbados in October of last year, in which the dictator committed to holding free and fair presidential elections.

Maduro failed to comply with the agreement not only after illegitimately disqualifying María Corina Machado, who won the primaries organized by the opposition with more than 90% of the votes, but also intensified the persecution and repression against other opponents and activists and prevented the registration of candidates who had Machado's support.