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India oils economic ties with USA's latest victim Venezuela

 PTI |  2016-08-19 00:34:48.0  |  New Delhi

India oils economic ties with USA

ONGC Videsh Ltd owns 40 per cent of the San Cristobal oilfield but has not been paid for its share of oil sales for last couple of years. OVL, in 2008, had invested about $190 million in the project where state-run Petroleos de Venezuela SA (PDVSA) holds the remaining 51 per cent stake. 

Oil Minister Dharmendra Pradhan on Thursday met visiting Venezuelan Foreign Minister Delcy Rodriguez and Oil Minister Eulogio del Pino and discussed bilateral energy issues, including payment of dues. 

Sources said since cash-strapped Venezuela does not have hard cash to pay after oil prices slumped to a decade low, barter deals were discussed. One of the options is to adjust the outstanding against the crude oil Indian firms like Reliance Industries and Essar Oil import from Venezuela. The outstanding can be deducted from the payment these firms have to make to PDVSA for oil imports, sources said, adding the Venezuelean ministers were non-committal on the proposal. Alternately, OVL can take crude oil in lieu of the cash due, they said.  Venezuela is India's fourth largest source of crude oil, supplying some 23.6 million tons or 12 per cent of the country's annual import in 2015-16.
The cash-strapped OPEC member and holder of the world's biggest oil reserves has been unable to pay foreign partners on some of its projects as revenues slumped on fall in oil prices, triggering triple-digit inflation. The crisis was precipitated with funds being diverted to social programmes and fuel subsidies. Venezuela gets almost all of its export revenue from oil. It is already repaying loans outstanding to China with crude.

An official statement later said Pradhan held a bilateral meeting with two visiting ministers. "During the meeting, both sides discussed aspects of bilateral hydrocarbon engagements. These included, inter-alia, sourcing of crude and mechanism to register Indian oil and gas PSUs for sourcing of crude, status of the two upstream projects in which Indian PSUs have stakes and payment of outstanding dues to ONGC Videsh Ltd (OVL) by Venezuelan national oil company," it said. 

Govt signs short-term Bangladesh pact to route petro-goods to Tripura
India on Thursday signed a short-term route agreement with Bangladesh to allow transport of petroleum goods from Assam to Tripura through Bangladesh after heavy monsoon damaged roads and made the transportation between the two states difficult. This is a short-term deal and Bangladesh side agreed to the Indian proposal to grant validity of the MoU till September 30, officials in Dhaka said. "Based on the request by the Government of India, the Government of Bangladesh has granted permission for the movement of petroleum goods on humanitarian grounds through the territory of Bangladesh till September 2016," High Commission of India here said ina statement. 

Indian Oil Corporation Limited (IOCL), a Public sector unit under the Ministry of Petroleum and Natural Gas of the Government of India, and the Roads and Highways Department of the Government of Bangladesh (RHD) signed the deal. India made the request following heavy monsoons and extremely bad road conditions of NH44 have resulted in the disruption in the supply of Petroleum Goods from Assam to Tripura, The Daily Star reported. Diplomatic sources said the MoU will facilitate India to carry Petroleum Goods (Motor Spirit, High Speed Diesel, Superior Kerosene Oil & Liquefied Petroleum Gas) from Assam to Tripura. 

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