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| Caribbean-Latin America |
| India signs deal to operate Venezuelan oilfield |
| 2005-03-05 |
| NEW DELHI (Reuters) - Energy-hungry India clinched a deal on Saturday to operate a Venezuelan oilfield and import the output as Asia's third largest consumer and the world's No.5 oil exporter vowed to strengthen ties, officials said. Venezuelan President Hugo Chavez said in New Delhi Petroleos de Venezuela and ONGC Videsh, the overseas subsidiary of India's state-run exploration firm, had signed an agreement to jointly explore and produce oil in Venezuela. "We have already chosen a specific field where we will start drilling. This oil will come to India," Chavez told reporters. The two countries signed an agreement to cooperate in the oil sector, paving the way for Oil and Natural Gas Corp. and gas transmission firm GAIL India Ltd to bid for exploration blocks in Venezuela, officials said. "Within the overall framework, the specific agreement is ONGC's Videsh Ltd.'s negotiation on nomination basis for the San Cristobal oilfield," India's oil minister, Mani Shankar Aiyar, told reporters. He said the field has the potential to produce 100,000 barrels per day (bpd). "According to Venezuelan law, they will keep 51 percent, we will receive 49 percent plus operatorship," he said. On Friday, Aiyar said India would also offer Venezuela equity in Mangarlore Refinery and Petrochemicals Ltd (MRPL), the refining subsidiary of ONGC. Chavez said he wanted Venezuela to be a long-term supplier of crude to India and welcomed Indian investment in his country. "All major oil and gas companies are there. Chinese companies are there. Indian companies are not there. India needs energy and energy is there to be shared with the rest of the world, you specially," he said. India's sole private refiner, Reliance Industries has imported Venezuelan crude in recent years but state-run firms have not processed oil from the country. Aiyar said MRPL's refinery could process Venezuelan crude and other oil firms were assessing which grades of oil from the country they could refine. India, which imports 70 percent of its crude needs, consumed 2.46 million bpd in 2004 and is forecast to use 2.53 million bpd this year, estimates from the International Energy Agency show. The country is likely to import 85 percent of its consumption in the next two decades as its economy grows between 7-8 percent a year, encouraging ONGC to compete with China for foreign oil projects. In January, China signed energy accords with Venezuela that aimed to make the largest oil consumer in Asia a major player in the Venezuelan oil and gas industry. Venezuela ships more than half its daily output to the United States in a decades-old energy relationship. But Chavez, a fierce critic of Washington, has made clear he wants to diversify his country's overseas energy ties to reduce its economic dependence on the American market. ONGC Videsh, has stakes in oil and gas projects in countries such as Myanmar, Sudan, Russia, Libya and Australia and recently signed a $40 billion deal to import LNG from Iran. |
| Posted by:TMH |