Cash-strapped Venezuela offers Indian firm increased oil field stake

Cash-strapped Venezuela offers Indian firm increased oil field stake

State oil firm Petroleos de Venezuela SA (PDVSA) has offered Indian oil company ONGC Videsh an increased stake in an oil field, as the conflict-burdened nation attempts to patch up its damaged energy sector.

PDVSA are proposing the divestment of a 9% stake in the San Cristobal field to state-owned ONGC, who already owns a 40% stake in the field, which produces between 22,000-23,000 barrels per day (bpd) of oil.

Despite holding the largest reserves of crude oil in the world, Venezuela’s economy has been ravaged by triple-digit inflation and product shortages after months of violent protest.

Consequently, state officials are looking to cash in on its oil assets in fields such as San Cristobal, even though the 9% sale would return a relatively modest fee according to analysts.

PDVSA can only offer 9% to the Indian firm as Venezuela’s hydrocarbon laws dictate that the state must maintain more than 50% of all oil ventures.

The OPEC member nation’s oil output has slipped in recent months as political violence has escalated, which has been compounded by the falling price of oil across global markets.

@RGNonline