The Oil and Natural Gas Corporation (ONGC) has secured a pivotal license from the US Treasury Department's Office of Foreign Assets Control (OFAC), paving the way for the full resumption and expansion of its operations in Venezuela. This crucial approval liberates ONGC from sanctions-related risks, empowering its overseas investment arm, ONGC Videsh Ltd (OVL), to actively manage its stakes in projects like San Cristobal and Carabobo, pursue financial recovery, and potentially assume operatorship.

The Oil and Natural Gas Corporation (ONGC) has secured a pivotal license from the US Treasury Department's Office of Foreign Assets Control (OFAC), paving the way for the full resumption and expansion of its operations in Venezuela. This crucial approval liberates ONGC from sanctions-related risks, empowering its overseas investment arm, ONGC Videsh Ltd (OVL), to actively manage its stakes in projects like San Cristobal and Carabobo, pursue financial recovery, and potentially assume operatorship.

The Oil and Natural Gas Corporation (ONGC) has secured a pivotal license from the US Treasury Department's Office of Foreign Assets Control (OFAC), paving the way for the full resumption and expansion of its operations in Venezuela. This crucial approval liberates ONGC from sanctions-related risks, empowering its overseas investment arm, ONGC Videsh Ltd (OVL), to actively manage its stakes in projects like San Cristobal and Carabobo, pursue financial recovery, and potentially assume operatorship.

State-owned Oil and Natural Gas Corporation (ONGC) has received a licence from the US Treasury Department's Office of Foreign Assets Control (OFAC), clearing the way for the company to fully resume operations in Venezuela.

The approval is significant for ONGC as it removes a major obstacle that had limited its ability to manage and expand its investments in Venezuela.

Speaking during an investor call after the company's first-quarter earnings announcement recently, ONGC Director (Finance) Anupam Agarwal said the licence gives the company the freedom to actively pursue opportunities in Venezuela without concerns linked to US sanctions.

"Now we have full freedom to work on the Venezuela project because earlier we were restricting our operations there because of the sanction-related risks. Those risks are behind us," Agarwal said.

The licence could enable ONGC to expand production, enter into fresh agreements and potentially assume operatorship of certain projects currently managed by Venezuela's state-owned oil company, Petroleos de Venezuela S.A. (PDVSA).

ONGC Videsh Ltd (OVL), which is the company's overseas investment arm, holds a 40 per cent stake in the San Cristobal oil project, with the remaining share held by PDVSA. It also owns an 11 per cent interest in the Carabobo project, which is still under development.

A key benefit of the OFAC approval is that it allows ONGC to manage the finances of its Venezuelan ventures and pursue recovery of pending dividends exceeding ₹500 million.

According to Agarwal, ONGC is already in discussions with Venezuelan authorities and its joint-venture partners regarding the San Cristobal and Carabobo projects, with expectations of positive developments, including new agreements and possible transfer of operatorship.

The licence is also expected to help ONGC increase production from its Venezuelan assets. San Cristobal produced around 0.265 million tonnes of oil equivalent in FY26, which the company said represents only a fraction of the field's production potential.

Venezuela is extremely important for ONGC because the country possesses the world's largest proven crude oil reserves, estimated by OPEC at around 303 billion barrels. Years of sanctions, underinvestment and operational challenges have constrained production, leaving considerable scope for future development.

Agarwal noted that Venezuela's new petroleum law offers additional fiscal incentives for resource development, potentially creating a more attractive environment for foreign investors.

ONGC's Venezuelan portfolio is focused on shallow onshore fields, an area where the company believes it has strong operational expertise through its experience in domestic fields such as Mehsana and Ahmedabad.

"We are very bullish for Venezuela," Agarwal said, adding that ONGC expects new agreements and the possibility of taking over operatorship of some projects from PDVSA in the near future.

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