Moscow. 27 October. INTERFAX - The governments of the Russian Federation and Vietnam have reached an agreement regarding further collaboration in the geological exploration and production area based around the Vietsovpetro joint venture.
The document was signed on Monday during negotiations in the Kremlin by the presidents of Russia and Vietnam.
The agreement provides for extension of the work by Vietsovpetro – the joint venture company set up between Zarubezhneft and Petrovietnam – after 2010.
It is planned that from 1 January 2011, Vietsovpetro will turn into a limited liability company in Vietnam with two shareholders – Zarubezhneft and Petrovietnam – with shareholdings of the authorised capital of 49% and 51% respectively.
In addition, in accordance with the document, Vietsovpetro as a limited company will continue oil and gas activities in block 09-1 of the South Vietnamese shelf (White Tiger and Dragon deposits) and block 04-3 based on the oil and gas contract in line with Vietnamese legislation.
According to Nguyen Tiyen Zunga, deputy director general of Petrovietnam, who is quoted in the Zarubezhneft report, the reorganisation of the joint venture Vietsovpetro will enable oil exploration and extraction work to be conducted in blocks 09-1 and 04-3, and service activities to be delivered both on Vietnamese soil and in other countries.
As previously reported, in September 2007 Russia and Vietnam signed a protocol relating to an agreement between the USSR and Vietnam from 1991 concerning the extension of activities of the Vietsovpetro joint venture after 2010. The protocol also assumed there would be a change in legal status for the work of the joint venture; in particular, the transfer of the Russian part of Zarubezhneft, which previously conducted work in the joint venture on behalf of the Russian side.
Vietsovpetro owns the licences for seven deposits in the South Vietnamese shelf – White Tiger, Dragon, Daikhung, Wolf, Babi, Baden, Tamdao and the Tkhanlong structure.
Over the years, co-operation between Petrovietnam and Zarubezhneft achieved considerable successes. From the start of production (in June 1986), Vietsovpetro has extracted 174 million tonnes of oil. The profits on the Vietnamese side from sales of tank oil amounted to $27.2 billion, and the Russian side, $7.3 billion. For the current year, production is expected to amount to 7.65 million tonnes of oil. From 2008 to 2010, it is planned to extract 1.85-18.8 million tonnes of oil in the White Tiger and Dragon deposits.
In addition, an oil and gas contract was signed in the Kremlin between Gazprom and Zarubezhneftegaz on the one side and Petrovietnam and its subsidiary company PVEP (a general oil and gas exploration and production company) on the other side for carrying out geological exploration work and development in blocks no. 129, 130, 131 and 132 on the Vietnamese continental shelf.
Earlier in 2008 an agreement was signed between Gazprom and Petrovietnam regarding further collaboration, which included geological survey and development work on the Vietnamese shelf for blocks 129, 130, 131 and 132.
The first contract for the exploration, extraction and production of hydrocarbons in block N112 was signed by both parties in 2000. In this block last year, industrial inflows of natural gas were obtained at a flow rate of up to 400,000 cubic metres per day. During production, the wells also recorded the presence of gas condensate.
Amongst the signed documents was also the “Principal Regulations for the Creation of a Joint Venture Company” called Gazpromviet between Gazprom and Petrovietnam, and also the preliminary agreement between Zarubezhneft and Petrovietnam regarding the transfer of 49 percent of authorised share capital in the limited liability company Rusvietpetro.
In May of this year Gazprom and Petrovietnam signed an agreement which provided for the creation of a joint venture called Gazpromviet, to participate in oil and gas projects in the Russian Federation and other countries, for example Kazakhstan and Turkmenistan. Petrovietnam will receive 49% of the joint venture, and Gazprom, as Zarubezhneftegaz, has 51%.
An agreement was also concluded regarding collaboration to carry out investments in the building of a plant for manufacturing ammonia and carbamide in Kalmyk.
Copyright © 2003-2006 Interfax EQT Support Boost