- Revival plan seeks to raise output, make field profitable
- San Cristobal's output fell to 28,000 b/d from 38,000 b/d
Oil & Natural Gas Corp., India’s biggest explorer, may invest as much as a half billion dollars to revive a faltering Venezuelan field.
The company’s overseas unit ONGC Videsh Ltd., which owns a 40 percent stake in the San Cristobal field in the Orinoco heavy-oil belt, is seeking to boost output with partner Petroleos de Venezuela SA, said P.K. Rao, director of operations at ONGC Videsh.
“We are yet to finalize the detailed plan, but our share of investment could be around $500 million,” Rao said in a phone interview from New Delhi. “The revival plan will aim at making the San Cristobal project profitable.”
ONGC Videsh invested about $190 million for its stake in 2008. The field produces about 28,000 barrels a day, down from a peak of 38,000 barrels, ONGC Videsh Managing Director Narendra Kumar Verma said in August.
Strapped for cash, oil-rich Venezuela has struggled as its revenue and currency have declined with crude prices. The nation with the world’s largest reserves produced about 2.7 million barrels of oil a day in 2014, down from around 3.5 million in 1998, according to the latest data available from the BP Statistical Review of Energy.
An agreement between the two companies may mirror similar deals in recent years reached with service providers and foreign partners to increase output. Chevron Corp. and PDVSA signed a low-interest, $2 billion loan agreement in 2013 to boost production in western Venezuela.
India surpassed the U.S. to become the largest destination for Venezuelan crude exports shipped from the country’s main export port for the first time in seven months in January with about 566,000 barrels a day, according to vessel tracking and U.S. Customs data compiled by Bloomberg.
Calls to PDVSA’s media office in Caracas for comment on a potential deal were not returned.