India’s state‑run oil company, ONGC, has obtained a licence from the US Treasury’s Office of Foreign Assets Control, effectively lifting the sanctions that had restricted its work in Venezuela. The approval means ONGC can now operate freely in the country’s oil sector.
With the new licence, ONGC can put more money into its Venezuelan assets, increase oil production, sign fresh agreements and even take over the management of some projects currently run by the state‑owned PDVSA.
Anupam Agarwal, ONGC’s Director‑Finance, said the company now has “full freedom” to work on its Venezuelan projects. He added that the sanction‑related risks that had limited the company’s operations are now behind them.
The licence also has a big financial impact. It allows ONGC to handle the money tied to its Venezuelan projects and could help the company recover a pending dividend of more than USD 500 million.
ONGC has been in talks with Venezuelan authorities and its joint‑venture partners about its investments. The company expects progress on new agreements and is considering taking over operatorship of some projects from PDVSA.
For years, US sanctions made it hard for ONGC to conduct financial transactions, invest, and expand in Venezuela’s oil sector. The restrictions forced the company to keep its activities limited despite its existing presence.
Venezuela is strategically important for ONGC because it holds about 303 billion barrels of proven crude oil, the largest reserve in the world. However, production has remained below potential due to underinvestment, sanctions and operational challenges.
The recent petroleum law enacted by Venezuela offers additional fiscal incentives for resource development, which could boost ONGC’s investment case.
ONGC is focusing on shallow, onshore fields in Venezuela, where it has experience from operations in western India such as Mehsana and Ahmedabad.
Agarwal said ONGC is very bullish about Venezuela. He expects new agreements soon and could potentially take over operatorship of some projects from PDVSA in the near term.