Venezuela’s self-proclaimed interim president Juan Guaido is said to be preparing draft legislation that would allow international companies to have a more active role in the country’s oil and gas sector, writes Fabio Palmigiani.

The proposed revamp in the hydrocarbons sector of the oil-rich nation takes place as the power struggle between Guaido and incumbent Nicolas Maduro is about to enter its third month, with the country hit by devastating blackouts in Caracas and other cities.

According to documents obtained by Reuters, the proposed ruling would shrink the participation of state-owned PDVSA while calling for regulatory changes to try to make Venezuela more attractive to foreign investors.

Under the proposal, private companies would be allowed to run operations at Venezuelan oilfields — under current legislation, foreign players can only hold minority interests.

PDVSA would continue as the main player, but the idea is to create an independent regulatory agency to be in charge of auctioning off new acreage, mimicking changes that were successfully implemented in Brazil and Mexico.

A so-called “round zero” would be organised to give PDVSA the right to pick its preferred fields, with the rest, and potential new blocks, to be offered to investors later.

Guaido’s team is understood to be proposing a number of exploration and production contracts in an effort to restore Venezuela’s oil industry by offering them to the highest bidder.

“The Venezuelan oil industry has collapsed after years of arbitrary policies that turned PDVSA and its subsidiaries into political tools serving the socialist model,” read the document.

Earlier this week in Houston, Carlos Vecchio, a member of Venezuela’s opposition government, hinted that officials close to Guaido had begun discussing a new hydrocarbons law as an alternative to the existing model.

Such plans are symbolic as long as Maduro remains in power but have the backing of the US.

However, the initiative may backfire and give further ammunition for Maduro’s claims that Guaido is a puppet for foreign interests, some observers have suggested.

The oil industry, which generates about 90% of Venezuela’s trade income, was nationalised by former President Hugo Chavez in 2001, forcing companies such as US supermajors ExxonMobil and ConocoPhillips to either enter in joint ventures with PDVSA or leave the country entirely.

In the meantime, Guaido called for new public demonstrations against Maduro as blackouts continued.

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Guaido reported to be working on new energy legislation in Venezuela