Vietnam’s national oil company PetroVietnam is joining forces with a couple of American oil companies to make the best of a great situation.
The Southeast Asian producer recently acquired two Chevron Corp (NYSE: CVX) offshore production sharing contracts and one gas development project.
The latter was already explored and found to have natural gas resources by Chevron. PetroVietnam holds a 28.7% non-operating interest in this asset, but it is the company’s current most important project. It includes the use and expansion of the Chevron Southwest Vietnam Pipeline Co. and its infrastructure.
These large, proved assets make PetroVietnam worth a look, with both Murphy Oil Co. and ExxonMobil interested.
PetroVietnam’s agreements with Murphy Oil are based on cooperation on petroleum production, and the company believes Murphy’s expertise in exploring and exploiting deep sea oil and gas resources will be helpful when it comes to its offshore assets.
ExxonMobil’s interest is purely in PetroVietnam’s offshore natural gas assets. The two companies signed an agreement in 2013 to work together in developing the Ca Voi Xanh gas project. Two of the three test wells hit gas, and there are now plans in the works to build a gas field for production by 2021.
PetroVietnam Chairman Nguyen Xuan Son has urged ExxonMobil to use its best technologies to make this project a low-cost, high-efficiency one. Meanwhile, both companies will have a say in the gas price and consumption rates once the field is in production.
This project will also encourage PetroVietnam’s new plan to build natural gas power plants in the central areas of the country, which would bring more business opportunities for other such builders and energy companies.
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