Guyana and India have signed a major oil exploration and petroleum supply deal.

India today announced that it has approved the signing of a five-year memorandum of understanding (MoU) with Guyana for cooperation in the hydrocarbon sector including sourcing of crude oil.

A statement from the Indian government says the MOU covers a comprehensive range of areas including sourcing of crude oil from Guyana, participation of Indian companies in oil exploration and cooperation in crude oil refining.

India, the world’s third largest energy consumer and importer, is looking to diversify its sources of oil imports and their authorities say Guyana is one of the countries it is looking at.

The MoU, which has been in discussion for more than two years, will be for an initial period of five years, with a provision for automatic renewable if the two countries agree.