India’s Oil and Natural Gas Corporation (ONGC) has signed a joint venture with Petroleos de Venezuela (PDVSA), the state owned oil company of Venezuela. Under this joint venture, the two companies will extract oil and from Venezuela’s Orinoco region. The deal is worth $400 million and ONGC will invest $450 million. This joint venture will increase Venezuela’s oil production.
BBC reports:
Venezuelan officials say that the deal is expected that production will start within three years, and that the project will yield 232 million barrels of crude over the next 25 years.
"It's the first association agreement between the two countries," said Venezuelan Oil and Energy Minister Rafael Ramirez, adding that it was "a first step" towards further energy cooperation.
Mr Ramirez also said that Venezuela planned to ship 150,000 barrels of heavy crude a day to India.
This project will be a win-win for both parties. Venezuela is the largest oil producing country in South America and the USA is the main buyer of its oil. This deal will reduce Venezuela’s dependency on the USA and India will be able meet its growing oil needs through the project.
Rapid industrialization has created a huge energy demand in India. Fuel price is already affecting the countrys economy. Such projects will help a lot to meet the growing fuel needs of India.
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