CARACAS (AFP) — Venezuela and India on Tuesday signed a five-year,
400-million-dollar joint venture to drill for oil and gas in
Venezuela's oil-rich southeastern Orinoco region, Oil and Energy
Minister Rafael Ramirez said.
"It's the first association
agreement between the two countries," Ramirez said after signing the
agreement with his Indian counterpart Murli Deora, the first energy
minister from India to visit Venezuela.
The joint venture brings
together Venezuela's state-owned oil company PDVSA and India's ONGC
Videsh Ltd., a subidiary of India's top oil company Oil and Natural Gas
Corporation Ltd (ONGC).
With PDVSA controlling a 60 percent stake
of the venture and ONGC Videsh Ltd. 40 percent, the two companies will
explore the 160 square kilometer (62 square miles) San Cristobal oil
field in northern Orinoco, a region the size of Croatia that is rich in
heavy crude oil.
Over the next few years, the joint venture is
likely to double Orinoco's oil production from its current 30,000
barrels per day to 60,000, Ramirez told reporters at PDVSA heaquarters.
studies by both companies also estimated the San Cristobal area can
yield 7,476 cubic meters (264 million cubic feet) of natural gas.
in 2006 increased its crude oil purchase to 50,000 barrels per day, and
its trade with Venezuela has grown from 60 million dollars per year in
2004 to 138 million in 2005, and close to one billion in 2006, mostly
in oil sales, the Indian Embassy said.
Venezuela, a member of the
Organization of Petroleum Exporting Countries (OPEC), is Latin
America's leading oil producer, with an estimated 100 billion barrels
of crude oil reserves.
Last year, the leftist government of
President Hugo Chavez nationalized the Orinoco oil fields, imposing a
60 percent share for PDVSA in all joint ventures in the area, and
compensating some foreign oil companies for their lost interest.
India, PDVSA is currently working with oil companies from Russia, Iran,
China and Latin American nations in exploiting the heavy Orinoco crude,
which is expensive to refine.
When fully tapped, Orinoco's
estimated 270 billion dollars of crude oil reserves would make
Venezuela the world's top oil producer, beating current leader Saudi