Venezuelan oil firm signs agreements with RIL, OVL

PDVSA will supply between 3,00,000 and 4,00,000 barrels per day of heavy crude to Reliance's two refineries in Jamnagar under 15-year contract

In a sign of increasing Indian involvement in Venezuela, the South American country’s state oil company, Petroleos de Venezuela (PdVSA), has signed two agreements with state-run ONGC Videsh Ltd (OVL) and private sector giant Reliance Industries Ltd (RIL).

Mukesh Ambani-led RIL and PdVSA have signed a joint study agreement for Ayacucho block 8 in the Orinoco oil belt of that country. According to the study agreement, both parties will jointly evaluate the development plan of the block. RIL and PdVSA have also extended the term of the memorandum of understanding (MoU) signed between the parties last year by one year for continued cooperation.

Meanwhile, an MoU was signed by D K Sarraf, managing director, OVL, and Ruben iguera, director of new development, PdVSA on Thursday. The pact encompasses strategic cooperation and participation in the exploration and production of hydrocarbon resources in the oil-rich Faja area of Venezuela. This would facilitate OVL and PdVSA to explore available opportunities through joint collaboration and hence, enhance OVL's interest in Venezuela.

Sudhir Vasudeva, chairman, ONGC group of companies, said: “This MoU underlines the spirit of collaboration between two exploration and production giants in India and Venezuela. Venezuela has the world’s largest reserves and we have a huge market. We intend to use this opportunity to further our interests in this oil rich country.” OVL currently has stakes in two producing projects in Venezuela--Petro-Carabobo and Petro-Indovenezolana--with investments of about $341 million.

RIL and PdVSA had signed a 15-year heavy crude oil supply contract and an MoU to develop Venezuelan heavy oil fields last year. According to that, PdVSA will supply between 300,000 and 400,000 barrels a day of Venezuelan heavy crude oil to RIL’s two refineries in Jamnagar under a 15-year contract.