India Engaging Venezuela to Strengthen Energy Security, Says MEA
Synopsis
The MEA confirms India's engagement with Venezuela for energy security. This comes as ONGC secures a US OFAC license, allowing it to resume full operations, invest further, and potentially recover over USD 500 million in pending dividends.
Ministry of External Affairs Spokesperson Randhir Jaiswal said on Tuesday that India continues to engage with Venezuela to strengthen its national energy security.
Addressing reports regarding state-run Oil and Natural Gas Corporation (ONGC) securing a US Office of Foreign Assets Control (OFAC) license to resume full operations in Venezuela, Jaiswal underscored New Delhi's broader focus on energy diversification. "On the question of ONGC, I don't know exactly what the position is. But on sourcing oil from Venezuela, I told you that we are engaging with Venezuela to strengthen our energy security," Jaiswal said during a press briefing.
ONGC to Resume Full Operations
The spokesperson's remarks reaffirm India's pragmatic approach toward securing reliable crude oil supplies and expanding trade ties with energy-producing nations to meet domestic demand. His remarks come as state-run Oil and Natural Gas Corporation (ONGC) is set to step up its activities in Venezuela after receiving a licence from the US Treasury's Office of Foreign Assets Control (OFAC), removing the sanctions-related restrictions that had limited the company's operations in the country.
The approval could allow ONGC to put more money into its Venezuelan assets, raise oil output, work on fresh agreements and potentially take over the operation of some projects currently managed by Venezuela's state-owned oil company PDVSA.
'Full Freedom' to Work on Project
Anupam Agarwal, Director-Finance at ONGC, said the company now has greater flexibility to work on its Venezuelan investments. "Now we have full freedom to work on the Venezuela project because earlier we were restricting our operations there because of the sanction-related risks. Those risks are behind us," Agarwal said during an investor call following the company's first-quarter earnings announcement.
Financial Recovery and Strategic Importance
The new licence is also important from a financial perspective. It will allow ONGC to handle the finances linked to its Venezuelan projects and could help the company recover a pending dividend of more than USD 500 million.ONGC has been discussing its Venezuelan investments with the country's authorities and its joint-venture partners.
For several years, US sanctions on Venezuela's oil sector had made it difficult for ONGC to carry out financial transactions, invest and expand operations in the country's energy sector. The restrictions had forced the company to keep its activities limited despite its existing presence there.
Venezuela's large oil reserves make the country strategically important for ONGC. According to the information shared by the company, Venezuela has around 303 billion barrels of proven crude oil reserves, the largest in the world. (ANI)