Venezuela has agreed to supply crude oil to India on a monthly basis over a two-year period to repay USD 537 million it owes to ONGC Videsh Ltd. The entire dues would be “squared off” in a couple of years.
OVL, the overseas arm of state-owned ONGC, owns 40 per cent of the San Cristobal field and had invested about USD 190 million in the project in 2008.
State-run Petroleos de Venezuela S.A., or PDVSA, holds the remaining stake. It has not been paid for its share of oil from the field for last few years.
San Cristobal project covers an area of 160.18 square kilometers in the Zuata Subdivision of proliferous Orinoco Heavy Oil belt in Venezuela.
The field currently produces about 28,000 barrels a day, down from a peak of 38,000 bpd.
OVL had received its dividend from sale of crude oil produced from the field totaling USD 56.224 million for 2008. But dividends for 2009 to 2013 totalling USD 537.631 million remained unpaid due to cash flow difficulties being faced by PDVSA.
Venezuela, the cash-strapped OPEC member and holder of the world’s biggest oil reserves, has been unable to pay foreign partners on some of its projects as revenues slumped along with crude prices and as funds were diverted to social programs and fuel subsidies.
