The U.S. government plans to take a 35% passive stake in Venezuelan businessman Alejandro Betancourt’s North American Blue Energy Partners, the Wall Street Journal reported on Saturday, citing people involved in negotiating the deal.
The U.S. also plans to secure preferential rights to purchase 20% of the company’s production at cost, the WSJ reported.
The Pentagon’s Office of Strategic Capital plans to structure the investment through penny warrants that would yield the U.S. an equity ownership in the business without significant capital investment, the WSJ reported.
The report comes only a day after U.S. President Donald Trump said on Friday that the U.S. would take control of a fifth of Venezuela’s vast oil reserves.
Trump provided few details about the arrangement, saying only that the U.S. had secured majority control of more than 65 billion barrels of Venezuela’s proven oil reserves through a partnership with private business.
Responding to a Reuters request for comment, chief Pentagon spokesperson Sean Parnell said: “The Office of Strategic Capital (OSC) does not take equity stakes in private companies. Under its statutory authority, OSC’s role is strictly limited to providing capital assistance in the form of a loan, loan guarantee, or technical assistance (including transaction structuring for developing and financing investments).”
The White House and North American Blue Energy Partners did not respond to requests for comments outside regular business hours.
(Reporting by Sathvi G Bhat and Gnaneshwar Rajan in Bengaluru; Editing by Christopher Cushing)