New Delhi, Mar 3 (UNI) The Cabinet today authorised ONGC Videsh Ltd (OVL) to form a joint venture company with CVP/Petroleos De Venezuela SA (PDVSA), Venezuela, for the development of San Cristobal field and invest up to 102.21 million dollars in a Qatar project, the Najwat Najem Appraisal, Development and Production Sharing Agreement (NNADPSA).
The approval was given on the recommendations of the Empowered Committee of Secretaries (ECS), an official spokesperson said.
The project would provide OVL the opportunity to obtain significant equity ownership in Venezuela, one of the largest oil producing countries. It would be the first OVL property in Venezuela and might open up other business opportunities.
San Cristobal field is located in Orinoco Oil belt. An investment not exceeding 356 million dollars would be made directly or through OVL's existing/new wholly owned subsidiary. The investment would include Signature bonus of 174 million dollars and capex of 182 million dollars in the venture. It would achieve IRR in excess of 10 per cent.
The Cabinet also authorised ECS to approve an additional investment upto 25 per cent of the original capital investment (Capex) out of the revenue from the project, provided the rate of return remained over 10 per cent.
OVL would invest 102.21 million dollars in the Qatar project directly through its own resources.
ONGC was authorised to provide funding and guarantee support to OVL, if required in both the projects without seeking budgetary support from the Centre.
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