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OVL in pact with Venezuela oil firm

business Updated: Apr 09, 2008 22:28 IST
Deepak Joshi
Deepak Joshi
Hindustan Times
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Stepping up efforts at greater cooperation between India and oil-rich Venezuela, ONGC Videsh Ltd (OVL) has entered into a major partnership with Venezuela’s Petroleos De Venezuela SA (PDVSA) for jointly developing a key oil field in the South American country.

OVL, the overseas investment arm of Oil and Natural Gas Corporation, will hold 40 per cent stake in the San Cristobal oil field, while PDVSA will hold the remaining 60 per cent. The agreement was signed during a visit of Petroleum Minister Murli Deora to Venezuela this week. Under the deal, the two companies will jointly develop the field from its current production level of 20,000 bbl per day to 40,000 bbl per day. The Indian government had recently approved OVL’s participation in the project with an investment of $ 356 million.

Deora described the agreement as a milestone in growing cooperation between India and Venezuela in the hydrocarbon sector. He expressed hope that this JV will pave way for more such mutually beneficial projects between the two countries.

The signing fructifies the efforts of Petroleum Ministry to take forward relations between India and Venezuela. It may be mentioned that during the visit of President Hugo Chavez to New Delhi in March 2005, an Agreement for Cooperation in the hydrocarbon sector was signed between India and Venezuela. To strengthen the cooperation between OVL and PDVSA, a Memorandum of Understanding (MOU) was also signed the same day to jointly develop oil and gas exploration and production projects.