Venezuela will supply India oil worth $600 million in lieu of the dividend it owes ONGC Videsh Ltd (OVL) for the Indian firm’s investment in an oil field in the South American nation, New Delhi announced on Wednesday.
OVL is the overseas investment arm of government-owned petroleum exploration firm Oil and Natural Gas Corp. (ONGC).
OVL owns a 40% stake in the San Cristobal field in Venezuela’s Orinoco Heavy Oil belt while the rest is owned by Venezuela’s state oil company PdVSA.
San Cristobal project owes a dividend of around $600 million to OVL, Reuters had reported.
OVL said it was “in continuous dialogue with PdVSA for recovery of accrued dividend by various mechanisms including allocation of crude cargoes in lieu of accrued dividend.”
“They have agreed to give us some oil in lieu of OVL’s dues. We are waiting for (lifting) dates from them,” said Pankaj Jain, secretary, ministry of petroleum and natural gas.
With the US easing sanctions on Venezuela in October, Indian refineries have resumed importing oil from the country.
Reuters reported that top Indian oil importers including Reliance Industries Ltd (RIL), Indian Oil Corp. Ltd (IOCL), and HPCL-Mittal Energy (HMEL) have been looking for Venezuelan crude oil.
Venezuela’s oil sales to India were suspended in 2020 when the US imposed sanctions on Caracas in response to the Nicolás Maduro government’s crackdown on pro-democracy protests.
PdVSA was one of the affected companies due to sanctions. India, one of the biggest buyers of oil in the world, imported $6.03 billion worth of petroleum from Venezuela in 2019-20.
Jain also told reporters that state-owned Petronet LNG is likely to sign a deal with Qatar this month, extending its long-term liquefied natural gas (LNG) imports.
“We are pretty close to signing the deal,” Jain said.
Petronet, which currently has a 7.5 million metric ton per year LNG import deal with Qatar, had until the end of 2023 to negotiate for the renewal of the agreement that expires in 2028. The deal, however, will be signed in the first month of 2024.