65 Billion Barrels Is Only the Beginning

President Trump announced this weekend that the United States had secured majority control over more than 65 billion barrels of Venezuela’s proven oil reserves through a partnership with private business.That is a big number. But it is not the number the oil and gas industry will be focused on.Venezuela already has the largest proven oil reserves in the world. It produces only about 1.25 million barrels a day. That gap tells you a lot about what comes next.Sixty-five billion barrels of reserves is not 65 billion barrels of supply.The oil is there. The harder question is what it takes to actually produce it.Existing wells may need work. Infrastructure needs investment. Equipment and people have to move into the country. Companies have to decide the economics work. And before anyone commits billions of dollars, they have to be comfortable that the agreements they sign today will still be enforceable years from now.That is the part experts in this industry will be watching.My firm works with oil and gas companies on the agreements behind development. Most people will never read those agreements, but they matter. Companies need to understand what they own, what they control, what they ...