Japan's JOGMEC is to provide equity financing to fellow Japanese firms Idemitsu Kosan and Sumitomo Corporation, which acquired participating interests in the exploration Blocks 39 and 40/02 offshore, Vietnam.
Idemitsu and Sumitomo signed the production sharing contract (PSC), with state-owned Vietnam Oil and Gas Group (PetroVietnam) for the blocks, offshore southwest Vietnam, 11 August. JOGMEC will provide equity capital up to 50% covering the exploration expenditures incurred by the subsidiaries of Idemitsu and Sumitomo for the project.
Within the framework of JOGMEC’s Cooperative Overseas Surveys and Studies Program, under a joint study agreement between JOGMEC and PetroVietnam, Idemitsu and JOGMEC carried out 2D seismic data and geochemical studies offshore southwest Vietnam October 2011 to August 2013. As a result, Idemitsu exercised the exclusive right to negotiate with PetroVietnam regarding the PSC, with Sumitomo as a partner.
"It is a significant achievement and outcome of JOGMEC activities that the Cooperative Program has immediately contributed to the acquisition of exploration acreage, where, furthermore, JOGMEC continues to be involved through its equity financing," says JOGMEC.
"Through the support of JOGMEC, it is expected to enhance upstream activities for Idemitsu and Sumitomo in Vietnam as well as reinforce Japan’s energy security when successful."