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PetroVietnam, Exxon Mobil ink $10bn gas project agreement

Tuesday, March 28, 2017, 14:13 GMT+7
PetroVietnam, Exxon Mobil ink $10bn gas project agreement
PetroVietnam and U.S. Exxon Mobil Corp representatives sign the investment agreement in Quang Nam Province, located in central Vietnam, on March 26, 2017.

PetroVietnam and U.S. Exxon Mobil Corp have signed an investment agreement on a major gas project off the central province of Quang Nam, the Vietnamese state-run energy group said on Monday.

The gas field, called Ca Voi Xanh (Blue Whale), has some 150 billion cubic meters of gas reserves, three times the reserve of Nam Con Son, the country’s current biggest gas project.

The signing of the PetroVietnam-Exxon Mobil agreement was witnessed by Vietnamese Prime Minister Nguyen Xuan Phuc, during an investment promotion conference in the central province last week.

At the event, Quang Nam authorities handed over investment licenses on 32 projects, with a combined registered capital of US$15.8 billion.

The Ca Voi Xanh project has a total investment of some $10 billion, PetroVietnam CEO Nguyen Vu Truong Son told Tuoi Tre (Youth) newspaper on Monday.

Son added that the project has many shareholders, with the Vietnamese side holding a stake of around 40 percent.

Under the agreement, the U.S. energy giant will construct two underwater exploration complexes, each with four gas wells, plus an 88km pipeline system connecting the project with the Quang Nam shore.

PetroVietnam will in turn invest in a gas treatment plant, a two-turbine power plant in Quang Nam’s Nui Thanh District, and another power plant in nearby Quang Ngai Province.

The $10 billion project is scheduled to be commissioned in 2023, with the gas used to fuel the power plants.

The investment cooperation agreement was signed only two months after PetroVietnam and Exxon Mobil reached a framework heads of agreement and a gas sales heads of agreement for the project in January, during the then-U.S. Secretary of State John Kerry’s visit to the country.

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