On Thursday, industry leaders at the Venezuela Energy Week London Industry Showcase emphasized that Venezuela’s recently enacted hydrocarbons framework represents a significant milestone in restoring the nation’s appeal as a destination for upstream investment. They cited streamlined tax terms, enhanced operational flexibility, and climbing output as critical factors fueling renewed interest from investors.
Presented to global investors and industry players in London, the country’s regulatory structure establishes a combined government take as low as 20% on greenfield upstream projects through a simplified fiscal system that replaces over 20 legacy taxes. Analysis shared during the event indicated that the reforms make Venezuela one of Latin America’s most favorable upstream jurisdictions.
The new terms, introduced through implementing regulations that took effect in July, combine a variable royalty with the Integrated Hydrocarbons Tax to produce combined rates of 20% for greenfield developments and 25% for extra-heavy and diluted crude projects. Both the windfall tax and the shadow tax—previously seen by investors as obstacles to high-CapEx ventures—have been eliminated.
Carlos Bellorin, Executive Vice President of Macro Analysis at Welligence Energy Analytics, noted that his firm has modeled expansion under the updated framework and found Venezuela’s terms highly competitive on a global basis. Production has recovered to roughly 1.2 million barrels per day, he added, with Welligence forecasting output to reach between 1.4 million and 1.6 million barrels per day by the end of 2026.
“Below two million barrels per day it’s an OpEx game,” Bellorin said. “After that, you need the big companies to come in.”
Juan Carlos Andrade, CEO of Araya Energy Group and Director and Legal Counsel at the Venezuelan Petroleum Chamber, stated that the regulatory overhaul has eliminated constraints that formerly forced operators to address shortcomings through contractual workarounds. Operators now have the authority to trade their own barrels, manage their own cash flow, and develop on-site power generation.
“This is no longer a theory,” Andrade said. “What exists is an opportunity.”
Andrade projected that Productive Participation Contracts could yield between 250,000 and 500,000 barrels per day, with mixed operating companies contributing a similar volume. Together, these two contract structures are expected to underpin Venezuela’s near-term production growth.
The London Industry Showcase is the first in a series of international events leading up to Venezuela Energy Week 2026, scheduled for October 26–29 in Caracas. The gathering will bring together government officials, international operators, investors, and technology providers to examine the country’s evolving regulatory framework, upstream opportunities, and long-term energy development strategy.
Supporting Venezuela’s Earthquake Recovery
Our thoughts are with the people and communities affected by the recent earthquakes in Venezuela. As the country begins the long process of recovery, we encourage members of the global energy community to support relief and reconstruction efforts through the CAF Recovery and Reconstruction Fund for Venezuela, which channels contributions from individuals, companies and organizations to emergency assistance, essential services and long-term rebuilding efforts.
To learn more or make a contribution, please visit the CAF Recovery and Reconstruction Fund for Venezuela.
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