Special Correspondent

Consortium plans to invest $8.8 b in oilfields and $12.1 b in the upgrader

NEW DELHI: Mukesh Ambani-owned Reliance Industries Limited (RIL) and Mangalore Refinery and Petrochemical Limited (MRPL) have committed to buy up to 45 per cent of the crude oil to be produced by ONGC Videsh Ltd (OVL) and its partners from Venezuelan oilfields.

OVL and partners — Spain's Repsol YPF, Malaysian state Petronas, Indian Oil Corporation and Oil India Ltd — had last month won the Carabobo-1 heavy oilfield in Venezuela. The work entails producing up to 4.80 lakh barrels a day (24 million tonnes a year) of extra-heavy oil and building an upgrader to convert it into higher quality crude.

The consortium plans to invest $8.8 billion in developing the oilfields and another $12.1 billion in the upgrader. OVL, Repsol and Petronas have a 11 per cent stake each in the project, while IOC and OIL have 3.5 per cent each. The balance 60 per cent is held by Petroleos de Venezuela (PDV).

Official sources said that of the planned output, Repsol had indicated that it could take 1.65 lakh barrels per day (bpd) while Petronas said it could take one lakh bpd. The remaining 2.20 lakh bpd was split equally between OVL and OIL. The project investment includes cost of constructing a heavy crude upgrader that can turn Orinoco's tar-like oil into valuable synthetic crude. The 200,000-bpd upgrader may be built at Soledad in Anzoategui state to produce synthetic crude of 32 degree API or higher by 2015-16. Originally, OVL had planned to bid for the Venezuelan oilfield along with RIL but it later dropped out and was replaced by Repsol and Petronas.