The paper assesses the high-profile opening of Venezuela’s oil and gas sector to private capital participation that took place throughout the decade of the 1990s. The paper places this initiative within the historical context of the Venezuelan oil industry evolution through the Concessionary (1914–1976) and Nationalization (1976–1990) periods, and explains the rationale behind this remarkable transformation of the country’s key industrial sector. The paper outlines the guiding principles and philosophy behind the policy and also describes the discrete steps and components of the initiative as they evolved throughout the opening process. These included the ground-breaking operating service agreements, the 1995 Exploration Round, and the strategic associations. The paper traces the effects of this process on the oil and gas sector in terms of investment and production impact, as well as the infusion of new participants, technology, ideas and practices into the economy, including, in particular, the development of a core of Venezuelan independent private oil companies. The paper also notes the profound impact on the national oil company, Petróleos de Venezuela, in terms of its restructuring and reorganization to fit with its revised role within the newly competitive domestic oil and gas sector. The paper concludes that private capital will continue to play a significant role in the development and growth of Venezuela’s society and economy, especially as it is directed towards the country’s embryonic natural gas sector and to its largely unexplored offshore waters.
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A “one-stop” business view on how to succeed in international exploration and production. Success in the international upstream arena requires more than the technical ability to find oil and gas. Relationships with governments and people, mutually beneficial contracts, workable strategies, and implementation plans are necessary to build strong, mutually beneficial, and profitable ventures. Key components that drive exploration and production in the global environment are examined. Specific topics include negotiating for success, contracts, the role of technology in international strategies, cross-cultural relationships, alliances, and international upstream financing. Authors from around the world, representing industry, governments, national oil companies, consultants, and academia, contributed their perspectives. Views are provided from both sides of the negotiating table, the corporate boardroom, the resident manager, the explorationist, the businessman, and the theoretician. Geoscientists, engineers, and negotiators, who are, or would like to be, involved in the global energy business will find this collection an important reference.