Petronas will relinquish Blocks 1 and 2 offshore Vietnam to host authority PetroVietnam once the production sharing contract (PSC) for the blocks expire on 9 September.
Petronas subsidiary PC Vietnam Ltd.’s (PCVL) 26-year PSC for the blocks, located in the Cuu Long Basin, took effect on 9 September 1991, and marked an important first step at the start of Petronas’ globalization journey, the company said in a 27 July press statement. PCVL is ending operations as stipulated by the contract terms.
“As a pioneer investor in the oil and gas industry of Vietnam, we are proud to have been given the opportunity by the host government to play a significant role in the development of the country’s oil and gas and petrochemical industries,” said Petronas President and Group Chief Executive Officer Datuk Wan Zulkiflee Wan Ariffin in the press statement.
The company will continue to conduct upstream production operations offshore Vietnam at Blocks 102 and 106 in the Song Hong Basin. These blocks are operated by Petronas Carigali Overseas Sdn Bhd.
The offshore Cuu Long and Nam Con Son basins have been the primary areas for oil production in Vietnam, according to a February 2017 report by the US Energy Information Administration. In 2016, Vietnam produced an estimated 320,000 b/d of petroleum and other liquids, nine percent lower than 2015 production of 350,000 b/d.