India hopes to gain operational control over two oil blocks in Venezuela by leveraging a new petroleum law, according to reports.

State-owned oil explorer ONGC hopes to sign agreements with the South American nation under the new provision, which grants operational freedom without sanctions risk.

In January, the US kidnapped Venezuelan President Nicolas Maduro and prodded Caracas to amend laws allowing private participation while keeping control over production, exports, and investments.

ONGC, through its overseas investment arm ONGC Videsh, holds a ‌40% stake ⁠in ⁠Venezuela’s San Cristobal field. Along with other Indian companies, ONGC also holds an 18% ​stake in the Carabobo-1 project.

“Now we have full freedom to work on the ​Venezuela projects,” ONGC finance director Anupam Agarwal was quoted as saying on a call with analysts. “Earlier, we were restricting our operations there because of the sanctions-related risk.”

Before 2019, India was a major buyer of heavy, sulfur-rich Venezuelan crude oil until US sanctions restricted trade. 

Agarwal said Venezuela was offering additional incentives under the new ​petroleum law, ​and also cited ONGC’s expertise in operating fields ⁠with similar geology in India.

Venezuela’s acting president, Delcy Rodriguez, welcomed the participation of Indian companies in the country’s oil and gas sector while on a visit to India in June.

The renewed overseas focus comes as India seeks to diversify its oil and gas supplies amid the conflict in the Middle East, which has led to supply disruptions, and as Washington advances a bill that could see up to 100% tariffs imposed on the top five importers of Russian oil and gas.

ONGC regained its 20% stake in Russia’s Sakhalin-1 oil and gas project in December after a gap of four ‌years.

Sakhalin-1 was transferred to a new domestic operator by Russia after sweeping Western sanctions following the Ukraine conflict. ONGC made payments into the Sakhalin-1 abandonment fund in rubles using dividends frozen in Russia, to restore its stake.

India’s crude imports from Russia surged to a record high in July, accounting for 55% of its total crude oil purchases.

New Delhi has also directed ONGC to build and fill another strategic petroleum reserve facility, which would expand its reserve capacity by a third.