On Thursday 11 December, the fifth conference of the Oil and Gas Contract Management Committee for Area 112 of the Vietnamese Continental Shelf was held in Hanoi.

The conference was attended by OAO Gazprom Head of Technical Management and Technology for Developing Marine Deposits Vladimir Vovk, OAO Gazprom Head of Management of Geological Surveys, Licensing and Underground Exploitation Sergey Karnaukhov, and ZAO Gazprom zarubezhneftegaz Deputy CEO Viktor Belogurov. The Vietnamese side was represented by VNG Petrovietnam Deputy GEW Department Head Dao Kuang Anh (President of Committee), NGC VNG Petrovietnam deputy Management Department Doan Tsui Tham, and PVEP Vice-President Tryong Hong Son.

The conference approved the work plans for the joint operating company (JOC) Vietgazprom in 2008 and its activity plan for 2009.

The fulfilment of the 2008 work plan, and the 2009 plan, was the subject of a talk by JOC Vietgazprom Director-General Vasiliy Slabous. In early 2008, during the contractual period, 3D seismic surveys were conducted over 800 sq km and three prospecting boreholes were drilled.

On 13 February 2008, the Vietnamese government issued a licence to widen the section to include block 111/04. In 2008, additional 2D seismic surveys were conducted over 2000 l/km per year along the coastal section of areas 111/04 and 112, and 3D surveys over 900 sq km in the Bao Vang deposits and the promising Bao Trang structure.

The data obtained from these seismic surveys are currently being assessed. Three prospecting boreholes are being prepared for drilling in the Bao Vang deposit, and three prospecting boreholes in the Bao Den, Bao Trang and Coastal structures. The drilling programme is expected to last 14 months, with work starting in June 2009.

On the same day a meeting of the Oil and Gas Management Committee was held with regard to Areas 129, 130, 131 and 132 of the Vietnamese continental shelf. The participants examined and confirmed the works programme and JOC Vietgazprom’s budget for investigating these areas. In 2009 there are specific plans to conduct 2D marine seismic surveys over 8,800 km per year (reprocessing and interpretation of 10.750 km) and marine geochemical studies (about 1,000 samples to be taken).

The Management Committee also elected to appoint Valeriy Petrenko as JOC CEO. Mr Petrenko was previously financial director, executive director and first deputy director-general of ZAO Zarubezhneftegaz. Mr Slabous will return to his work as JOC production director.

Reference:
On 27 October 2008, in the presence of RF President Dmitry Medvedev and Vietnamese President Nguyen Minh Triet, Alexey Miller, Chairman of Gazprom, and Chan Ngoc Kanh, President of the Vietnamese Oil and Gas Group (VNG) Petrovietnam, signed an oil and gas agreement for Areas 129-132 of the Vietnamese continental shelf, for a 30-year period. The appointed operator for the project is JOC Vietgazprom, the joint operations company of OAO Gazprom and VNG Petrovietnam (with ZAO Gazprom representing the interests of Gazprom).

The investment certificate (licence) for realising the Oil and Gas Contract for the areas in the Vietnamese continental shelf was awarded to OAO Gazprom on 6 February 2009.

Vietgazprom, in accordance with the contract dated 11 September 2000, is currently conducting geological surveys on Area 112 of the Vietnamese continental shelf. The contract provides for the prospecting, extraction and sale of hydrocarbons.

In August 2007, during geological survey works by Vietgazprom in Area 112 of the Vietnamese Continental Shelf in the Bac Bo bay, drilling of a prospecting borehole in the Bao Vang area obtained an industrial flow of natural gas.

On 20 November 2006, OAO Gazprom and Petrovietnam signed a joint work agreement. This agreement provided for joint work between the companies in the following areas:
• prospecting, processing, transportation, use and sale of natural gas, oil and other energy sources;
• planning, construction, operation and servicing of oil pipelines and gas pipelines, oil and gas storage point, and pipeline distribution networks;
• diagnosis and control of the technical state and safety of gas and oil pipelines and of other parts of the gas and oil-chemical infrastructure;
• use of oil and gas as motor fuels, development and management of gas distribution systems and petrol stations network;
• processing of oil, gas and other types of raw hydrocarbons;
• supply of oil and gas refining products and oil and gas industry equipment.

The document also provided for interaction between the companies in promising projects in third-party countries, including surveying and development of oil and gas deposits.

On 23 May 2008, a continued joint work agreement was signed between Gazprom and Petrovietnam. The agreement provided for geological survey works and further mastering of new areas on the Vietnamese shelf.

The agreement also provided for the parties to create joint companies for work in Russia and third-party countries. In this agreement, Gazprom’s interests would also be represented by Gazprom zarubezhneftegaz.