An agreement between the two companies to exploit the around US$2 billion of heavy crude oil available at Baghewala was signed by Venezuela's ambassador to India, Walter Marquez, and OIL's director of exploration, S.K. Patra.

Under the terms of the contract, the two companies will conduct a consultancy service/technical collaboration that will include detailed geo-scientific and reservoir engineering studies of the oilfield. Patra also confirmed that, "PDVSA will provide us technology for bringing out the heavy crude oil, as well as, making it useable as feedstock in power plants."

Another OIL official, director of finance M.R. Pasrija, believes that around 15 to 16 million tonnes of crude oil can be recovered from the field.

Ambassador Marquez confirmed that his country's interest in assisting OIL stems from the discovery of heavy crude deposits in Rajasthan and Gujarat and the belief that vast reservoirs of light and medium crudes can be found between the Bikaner-Nagaur basins in Rajasthan. According to Marquez, "Venezuela, which holds world's largest heavy oil reserves, can help India exploit these."

Baghewala oilfield will be developed by PDVSA in two phases. In Phase I, detailed reservoir and geoscientific studies will be conducted to select a suitable recovery technique and plant design. Phase II will see the implementation of pilot scale production, which will then be followed by preparation of a development plan and the utilisation of options.