Indian national oil company ONGC Videsh (OVL) is looking to ramp up operations at its projects in Venezuela with approval from the US, according to company officials. If granted a specific license by the US Treasury, OVL plans to invest further in two oilfields where it is currently a partner, with the aim of doubling crude output within a year.
Speaking to journalists recently, OVL MD Rajarshi Gupta stated the firm had requested clarification and a license from Washington to operate the projects under a model first used by Chevron. This would allow some control over finances and operations despite Venezuela's majority stake, potentially unlocking over $500 million in dividends held up due to sanctions on the Latin American producer.
The San Cristobal and Carabobo 1 fields currently yield around 12,000-15,000 barrels per day together. However, Gupta estimates production could reach 30,000 bpd within twelve months and 45,000-50,000 bpd over the coming years through additional drilling. OVL holds minority stakes of 40% and 11% respectively.
If approved, revenue would firstly go towards recovering its dividends from Venezuela. The explorer believes investment can boost output substantially while also delivering for partners. A US nod could thus help ONGC's overseas investment arm recover funds and contribute more from assets in the sanctioned yet still vital OPEC member.
