Petrovietnam Acquires Chevron's Offshore Assets
Vietnam Oil and Gas Group (Petrovietnam) has acquired 100 percent of the shares in Chevron’s companies operating assets in Vietnam’s offshore shelf.
The companies include Chevron Vietnam (Block B), holding a 42.38 percent operating interest in the production sharing contract (PSC) covering Blocks B and 48/95, Chevron Vietnam (Block 52), holding a 43.40 percent operating interest in the PSC covering Block 52/97 and Chevron Southwest Vietnam Pipeline Company, holding a 28.7 percent working interest in a pipeline project that would deliver natural gas from offshore to gas users in Vietnam.
Since 1996, exploration in Blocks B, 48/95 and 52/97 offshore Vietnam has been intensive and wide ranging within the area covered by the PSCs. The contract area covers 3,200 square kilometers of the Malay – Tho Chu basin, southwest of Vietnam, with water depths ranging from 60 to 80m.
As a result, important gas discoveries were made that were declared commercial in 2002 with agreement on a joint development agreement reached in 2007. Estimates reviewed and approved by Vietnamese authorities include initially in-place gross gas at 6.008 tcf (170 bcm), 4 mcm condensates (25.5 mstb) and recoverable gas reserves (2P categories) at 3.78 tcf (107 bcm), 2 mcm condensates (12.65 mstb).
These gas reserves will increase when additional exploration is conducted in the remaining contract area. Petrovietnam thanked Chevron for its efforts in discovering and proving this large gas resource.
The Block B – O Mon project is designed to transport gas from Block B and 48/95 and Block 52/97 in waters southwest of Vietnam to the O Mon, Kien Giang power plant hub and to supplement gas supply to the Ca Mau gas fertilizer hub. Total investment for field development and construction of the gas – power project utilizing gas from Block B & 48/95 and Block 52/97 is estimated to exceed $10 billion and respond to the need to increase capacity beyond 4000 MW. The series of projects will strongly contribute to the development of the western region of the South.
Nguyen Xuan Son, Chairman of the Members’ Council of Petrovietnam, stated: “The Block B gas project is Petrovietnam’s main oil and gas project. The project is of major significance, contributing to ensuring the energy security of the country and promoting the socio-economic development of the region.
“The construction and operation of the series of projects to exploit, transport, and process gas and the construction and operation of power plants will stimulate the socio-economic development of the western provinces of the Southern region, contribute to the protection of the environment by using clean fuel, stabilize national power resources, and create an opportunity to linkup with the gas transportation networks of countries in the region,” he said.
“Petrovietnam’s completion of the acquisition of Chevron’s assets in Vietnam will facilitate the acceleration of field development and the implementation of the component projects in order to make gas more quickly available to serve the development needs of the national economy.”
Joint venture partners and the government of Vietnam have approved the acquisition which will become effective from 17 June 2015.