ONGC Videsh (OVL) is awaiting approval from the US department of treasury’s office of foreign assets control (OFAC) for its proposal to extract oil from two oil blocks in Venezuela. The request, which is in its advanced stages, involves seeking a specific license similar to what Chevron has obtained.
OVL Managing Director Rajarshi Gupta mentioned that the company is requesting exemptions from US sanctions to resume operations in Venezuela and receive crude oil in place of stock dividends.
Gupta added that OVL is negotiating with the Venezuelan government to take over operations of the two projects using what he described as the Chevron model. He noted that OFAC has provided some assurance that operations could proceed under certain pre-conditions. The specific license for operating in Venezuela is nearing final approval, Gupta said.
OVL holds a 49% stake in Venezuela’s San Cristobal project, which is operational, and an 11% stake in the under-development Carabobo project. As reported by thehindubusinessline.com, although Petróleos de Venezuela, SA (PdVSA), which manages both projects, had agreed to provide oil to OVL instead of cash dividends, the arrangement is currently stalled due to US sanctions restricting transactions with PdVSA.
