OVL chasing foreign govts to clear its $712 mn of dues

From Venezuela to Sudan, ONGC Videsh, India’s flagship overseas oil investment firm, is chasing foreign governments to get its $712 million (over Rs 4,700 crore) of dues cleared.

While Venezuela owes over $421 million in unpaid dividend on oil from San Cristobal project, Sudan is to pay OVL $192.31 million for oil it bought from its Greater Nile Oil Project and another $98.94 million in unpaid pipeline rent lease, official sources said.

In Venezuela, OVL, a subsidiary of state-owned Oil and Natural Gas Corporation (ONGC), had in April 2008 acquired 40 per cent stake in San Cristobal oil project. Corporacion Venezolana del Petroleo (CVP), a unit of state-owned Petroleos de Venezuela SA (PDVSA), owns the remaining stake.

With an investment totalling to $408.35 million, OVL’s share of crude oil production from the the 160.18 km acreage in the Orinoco Heavy Oil belt was 0.645 million tonnes in 2014-15.

OVL received $56.224 million as dividend on profit made by CVP in 2008, but dividends for 2009 to 2012 totalling to $421.51 million remained unpaid due to cash flow difficulties being faced by PDVSA/CVP.

Sources said the issue is being pursued at government-to-government level since last year but so far Venezuela has not indicated when the dues will be cleared.

The slump in oil prices with rates halving to below $50 per barrel has added to the problems as Venezuela is finding it difficult to meet its budget.

OVL had in 2003 acquired 25 per cent interest in Greater Nile Oil Project in Sudan. China’s CNPC holds 40 per cent stake in the project while Malaysia’s Petronas has 30 per cent and Sudapet of Sudan their remaining 5 per cent.

Upon secession of South Sudan from Sudan in July 2011, the contract areas of Blocks One, Two and Four which straddle between Sudan and South Sudan was split with major share of production and reserves are now situated in the South Sudan.

Overseas oil chase     

OVL trying to get $712 m dues cleared from foreign governments
Venezuela owes over $421 m in unpaid dividend on oil from San Cristobal project
Sudan is to pay OVL $192.31 m for oil it bought from the Greater Nile Oil Project
While another $98.94 m in unpaid pipeline rent lease is sought from Sudan