Chevron is on the verge of signing a new deal this week to expand its oil production in Venezuela, according to sources familiar with the transaction.

The oil giant is expected to add operations in the Orinoco belt, an area of Venezuela known for its vast reserves of heavy crude oil.

The expansion comes as the U.S. government is making its own separate bet on Venezuela's oilfields, taking a massive stake in the country's reserves through a partnership with a private Venezuelan company. The whole thing is complicated, but analysts advise investors to focus on the basics-watch the private companies that are willing to put capital behind real projects.

The race to commercialize Venezuela's oilfields is on, and is now moving forward on two different tracks. Private companies like Chevron are making deals with the Venezuelan government and state oil company PdVSA. And the U.S. government is placing its own bet, backing a Venezuelan company that just won rights to 65 billion barrels worth of reserves. The analysts sound more confident that the private companies can succeed.

"Whatever Chevron says that they can do with their production, plus a few others, I think is credible," said one veteran energy analyst. "I would not [bank on] even an additional barrel of additional Venezuelan oil from anything else."

Chevron already produces about 280,000 barrels of oil a day in Venezuela through joint ventures with PdVSA, about one quarter of the country's total production. The company has already said it can expand by another 50% over the next two years, and its new deal could allow for even larger growth. No other large U.S. company is currently producing oil in Venezuela, though some European players like BP and Repsol have been making energy deals there.

The U.S. government's effort is new and different. Venezuela is giving a long-term lease on 65 billion barrels worth of its reserves to private company North American Blue Energy Partners (NABEP), which is run by a Venezuelan oil executive named Alejandro Betancourt. NABEP, which is the second-largest producer in Venezuela today, plans to spend up to $100 billion to expand production in those reserves.

The U.S. took a 35% equity stake in NABEP's operation and got rights to buy 20% of the oil produced at the cost of producing it, plus a right of first refusal to buy the other 80%. The finances involved will be controlled by the Department of War. President Donald Trump says it won't cost U.S. taxpayers anything. Just what assets the U.S. is contributing to this partnership isn't clear.

A U.S. official said the government thinks its initiative can help jump-start Venezuelan production while also securing millions of barrels of oil for the U.S. But given that the U.S. isn't contributing capital, it isn't clear how NABEP will be able to raise the $100 billion it will need to ramp up output. NABEP didn't respond to a request for comment on its plans.

"The economics are pretty murky at this point," said Dan Pickering, chief investment officer at investment firm Pickering Energy Partners. Among other considerations, lenders might be turned off by the prospect of selling 20% of their production at no profit to the government, he noted.

Clay Seigle, a nonresident scholar in energy security at the Center for Strategic and International Studies, wrote in an email to Barron's that the latest "grandiose headlines" about Venezuela miss some smaller signs of progress. "Venezuela is adding oil production through small, realistic deals, made possible by new Venezuelan law and U.S. Treasury licensing changes. Output could increase by 50% from pre-intervention baseline during the next couple of years."