ONGC to invest $500 million in Venezuelan JV

Oil and Natural Gas Corporation (ONGC) is a public sector undertaking of the Government of India which deals with oil and gas.

Headquartered in Dehradun, Uttarakhand, the company was established in 1956.

ONGC, which had discovered 6 of the 7 producing basins of India, accounts for 70% of India's oil and 50% of India's gas production.

It produces 1.27million barrels of oil equivalent daily.

Venezuela is a South American country which has the largest oil reserves in the world.

PDVSA (Petróleos de Venezuela, S.A.) is a Venezuelan government-owned oil and natural gas company involved in exploration, production, refining and exporting of oil.

PDVSA's subsidiary- Corporación Venezolana de Petróleo (CVP)- owns 60% stake in the San Cristobal oil fields joint venture with ONGC Videsh Limited.

OVL (ONGC Videsh Limited), the overseas wing of state-run Oil and Natural Gas Corporation, is likely to arrive at an agreement with Venezuela's Petróleos de Venezuela, SA (PDVSA) to invest around $500 million in their San Cristobal Joint Venture.

The investment would be used to increase production at San Cristobal oilfield.

OVL and CVP share the San Cristobal oil field in a 40:60 ratio.

Investing in the San Cristobal oil field will help increase oil production in the field which has fallen from 38,000 barrels a day to 28,000 barrels a day.

It will also help revive the oil-dominated Venezuelan economy which is reeling under an economic crisis due to falling crude prices.

For India, it will help reduce crude oil dependence on conflict-ridden gulf countries.