PDVSA hands operations to Eni and GeoPark: who funds capital in the Orinoco Belt

Junín-5 holds 35 billion certified barrels underground and produces twelve thousand a day. In 2010, when the field was run by a joint venture with PDVSA at 60%, the project announced a long-term plateau of 240,000 barrels a day by 2018 and an $8 billion investment. On Wednesday the field changed hands without changing partners: Eni became its exclusive operator under a different contractual structure. What moved is neither the geology nor the ambition of the plan. It is who puts up the money and who answers if the barrel never shows up.

What the law says about the model, in its own words

The reform of the Organic Hydrocarbons Law was published in Official Gazette 6,978 extraordinary of January 29, 2026. Its explanatory memorandum describes the structure without euphemism: it incorporates the business models of the Anti-Blockade Law, "including Production Participation Contracts – CPP, where the operating company assumes integral management at its own cost and risk." And it adds the fiscal consequence in the same breath: "Under this model, the State incurs no debt and the operator's compensation consists of a percentage share of metered volumes."

Three decisions in two lines. The private party puts up the capital. The state does not borrow to keep pace with it. And what the operator takes home is not a dividend contingent on the venture closing the year with cash, but a share of the crude actually measured at the metering point.

The third decision draws the fewest headlines and changes the most for whoever invests. A dividend must be declared, approved, converted and transferred, and each of those steps has a chokepoint where money gets stuck. A share of volumes is collected the moment the barrel exists.

From Houston to Miraflores in two weeks

The structure was not born on Wednesday. The law's third transitional provision recognizes that production participation contracts signed under the Anti-Blockade Law retain "full validity and legal effect," and gives one hundred and eighty days to adapt them without worsening agreed terms. On August 18, at the IMAGE conference in Houston, the hydrocarbons minister formalized one of those contracts with Hunt Oil, a Dallas independent, over the Caro and Carisito fields, alongside Crossover Energy Holding; and a framework alliance with SLB for integrated reservoir studies.

What changed in fifteen days is the size of the signatory. A European supermajor accepted the same scheme that until August drew a Dallas independent and a services company, and did so to take over the operation of a field previously run by a venture in which the state was the majority partner. That jump is the story: not the novelty of the structure, but who is signing it now.

Junín-5, the same plateau promised twice

The field's own record measures what these announcements are worth. In December 2010 PDVSA and Eni presented Petrojunín with an early production phase of 75,000 barrels a day by 2013 and a long-term plateau of 240,000 by 2018. The announced investment was $8 billion and the ownership split 60% for the state company, 40% for the Italian. Sixteen years later the field produces about 12,000 barrels a day.

The distance between announced and produced is not explained by sanctions alone, which came later, nor by geology, which is the same as then. Under the joint venture model every outlay had to come out in ownership proportion, and the majority partner was the one with the least cash. An investment plan where 60% depends on whoever cannot pay it gets executed at the pace of whoever cannot pay it.

The production participation contract cuts that knot at the only point it can be cut without public money: by removing the state's obligation to contribute and, with it, its power to set the pace.

Who signed what, and for how much

Five companies signed at Miraflores on Wednesday and a sixth announced on its own that night. Counting them together misleads: the commitments are not equivalent, and only one carries a public investment figure.

The gradation matters because the market ignores it. A study right can be abandoned with no development cost; an operation with an approved work program binds from day one; and a signature neither party has documented binds nothing at all. Between those three grades lie years and hundreds of millions, and all three were announced the same Wednesday in the same room.

The argument on the other side

Reading this design purely as a giveaway ignores the problem it solves. Venezuela holds reserves it cannot develop with its own cash and a state oil company carrying unpaid obligations from the past decade. A model under which the state takes on no debt to invest is, in those conditions, the difference between an idle field and a field producing something.

There is also a precedent that explains why collecting in volumes is no minor concession. The Indian partner in the San Cristóbal field, holding 40% of the venture, has accumulated more than $500 million in dividends it has been unable to collect, and the way out it has negotiated for years is receiving crude deliveries instead of money. The new model turns into a general rule what was the emergency remedy of a partner who could not get its money out.

What is still unpublished

Between 20% and 35% is where July's regulation left royalty and tax combined, depending on the condition of the reservoir, but the specific rate is decided project by project and none of those files has been published. Nor is the payback period known, nor the share of volumes each operator collects, nor the minimum work commitment. And there is a written procedure no one has seen applied: article 39 requires the competent body to "promote the concurrence of diverse offers" when picking operators, with ministry-created committees to set conditions and select companies. There is no public record of that procedure in any of the announced awards.

That opacity has a measurable effect on anyone weighing entry: with no published reference contract, no one can tell whether the terms offered are better or worse than the neighbor's, and every negotiation starts without an anchor.

What to watch

The administrative act assigning each area. It is the document that turns a corporate release into an enforceable right. Until the registry publishes it, what was signed is an agreement between parties whose terms only the parties know.

The effective date of the Bare contract. GeoPark declared an estimated maximum of 120 days from signing to satisfy approvals and sanctions requirements, putting expiry at the end of December. It is the first self-imposed public calendar of the whole batch, and therefore the easiest to check.

The first quarterly report stating an amount and a plateau with a year. A listed company committing capital in a sanctioned country ends up explaining it to shareholders. The quarter closing in September is the first occasion on which Eni and GeoPark will have to put a figure next to the announcement.

Until one of those three documents exists, the honest way to measure the opening is not to add up deals: it is to count barrels. The country produced 1.2 million a day in July, nearly 30% above January's 924,000, and that series moves with or without a ceremony. Junín-5 and Bare together contribute about 23,000.