ONGC Videsh Negotiates With Venezuela to Recover Stuck Dividends

State-run ONGC Videsh Ltd (OVL) is negotiating with Venezuelan authorities and Petróleos de Venezuela SA (PDVSA) to recover nearly $500 million of stuck dividends, with payment options including cash or crude oil supplies, as the company prepares to revive operations in the South American nation following US sanctions relief, a senior official aware of the development said. The negotiations follow OVL securing a general licence from the US Office of Foreign Assets Control (OFAC) in July for operations in Venezuela. OVL holds a 40% stake in the San Cristobal oil project and an 11% interest in the Carabobo project, both in partnership with PDVSA. “Talks are underway for the dividend due to OVL and it is also being negotiated whether it would be paid in cash or in terms of oil supplies. This should be resolved by the time the framework is prepared,” an official aware of the discussions said. OVL is simultaneously working with Venezuelan authorities on a broader operating framework for the two assets. Rajarshi Gupta, managing director of OVL, said after ONGC’s annual general meeting on Monday that the framework could be finalised within the next three months. ONGC had said in an August 18 BSE filing: “The required go ahead was received from US Govt. in July, 2026. Framework agreements for further course of action in both the assets are under discussion with relevant stakeholders.” Queries sent to ONGC and OVL remained unanswered till press time. The OFAC clearance revives OVL’s efforts to recover dividends that have remained blocked for years. During a six-month US sanctions waiver beginning in October 2023, OVL was expected to receive the dues through an oil-for-equity arrangement. However, it could not receive the cargoes before sanctions were reimposed, halting the plan. The dividend issue dates back to the tenure of late Venezuelan president Hugo Chávez, when earnings from PDVSA were appropriated for social spending. Subsequent US sanctions curtailed production at San Cristobal and prevented repatriation of OVL’s earnings. Government-to-government discussions involving India, the US and Venezuela over the stuck dues were underway earlier this year, before the OFAC approval. A PDVSA delegation had visited India in January. The reopening of Venezuela has also acquired greater significance for India’s crude-supply diversification. Venezuelan acting president Delcy Rodriguez met petroleum and natural gas minister Hardeep Singh Puri during her India visit in June, when Indian oil and gas companies expressed interest in expanding existing investments and exploring new opportunities. Puri said an Indian technical team would visit Venezuela to assess energy-sector opportunities. India has also resumed Venezuelan crude purchases following the easing of sanctions and amid disruption around the Strait of Hormuz. Venezuela became India’s third-largest crude supplier in August, shipping around 350,000 barrels per day (kbd). “If U.S. and Venezuelan crude are combined, the Americas are becoming more important to India’s crude basket, but the recent increase is predominantly being driven by Venezuela rather than by a major ramp-up in U.S. crude,” said Sumit Ritolia, senior manager, modelling, at commodity tracker Kpler. Venezuela holds the world’s largest oil reserves. The White House said on Monday that Venezuelan interim authorities had granted US-backed North American Blue Energy Partners 100-year concessions covering 17 oil fields with around 65 billion barrels of proven reserves. The developments come after the US operation in Caracas on January 3 that captured President Nicolás Maduro and his wife Cilia Flores. US President Donald Trump subsequently signed an executive order protecting Venezuelan oil revenues held in US Treasury accounts from attachment or judicial proceedings.