India's ONGC wants US approval for two projects in Venezuela

Rajarshi Gupta, the managing director of ONGC Videsh Ltd in India, said that the company is looking for U.S. permission to run two projects to increase production in Venezuela.

Gupta said that ONGC wants to obtain a license similar to the one granted to U.S. oil giant Chevron for operating oil fields in Venezuela.

"We have requested a license to allow us to run our two projects. The approval will allow us to operate our two projects using U.S. entities and dollars. "We will use the funds to operate these projects", Gupta said.

He said that if the approval was granted, the company would be able to manage its Venezuelan projects' finances and recover a dividend owed of over $500 million.

He said that Venezuela had allowed ONGC the right to operate the San Cristobal Project, and for the Carabobo 1, ONGC was in discussions with Spanish firm Repsol about joint operating rights.

ONGC Videsh is the overseas investment arm for India's leading explorer Oil and Natural Gas Corp. It holds a stake of 40% in the San Cristobal Project.

Repsol, a Spanish company, holds a 11% stake in the Carabobo Project, while it, along with several other Indian companies, has an 18% stake. PDVSA (Venezuela's national oil corporation) holds the remaining stakes.

Gupta stated that the two assets produced about 12,000-15,000 barrels of oil per day (bpd), which can be increased to about 30 000 bpd within a year, and about 50 000 bpd after a few more years.

The MD also expressed the hope that OVL will soon receive approval from Russian officials to pay its $600,000,000 share in roubles towards the Sakhalin-1 abandonment fund. OVL needs this approval to keep its 20% stake in Sakhalin-1 in the Russian Far East.

Gupta stated that OVL plans to use the $250 million pending dividends from its stake in a Russian oil project in part payment for its share of the abandonment fund. (Reporting and editing by Vijay Kishore in New Delhi)

(source: Reuters)