OVL,IOC consortium wins oil field in Venezuela

An official said the group will pay USD 1.05 billion to Venezuela as signing amount.

Oil and Natural Gas Corp (ONGC) and partners Indian Oil Corp (IOC) and Oil India Ltd (OIL) have won a bid to develop a major crude oil block in Venezuela,its first major overseas success since Imperial Energy Plc acquisition in 2008.

The Indian firms will develop the Carabobo-1 block in Venezuela’s Orinoco Belt with Spain’s Repsol YPF SA and Malaysia’s Petroliam Nasional Bdh,ONGC said in a statement.

An official said the group will pay USD 1.05 billion to Venezuela as signing amount and will initially invest another USD 9 billion in developing the block that can produce 400,000 barrels of heavy oil per day (20 million tonnes per annum).

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Total spending on the block over 25 years would be USD 19 billion.

Besides,the consortium would also extend some credit to Venezuela’s state oil company Petroleos de Venezuela SA (PdVSA),which would hold 60 per cent interest in the project.

Venezuela yesterday announced winners of two of the three Carabobo blocks it had auctioned last month. The Latin American nation gave out 40 per cent stake to international firms,the largest oil investment in President Hugo Chavez’s 11-year rule.

Chevron Corp will develop the Carabobo-3 block along with Mitsubishi Corp,Inpex Corp and Suelopetrol CA of Venezuela after paying a signing amount of USD 500 million. A third oil block in the Carabobo area of the Orinoco will be assigned at a later date.