Vietnam National Oil and Gas Group (Petrovietnam) and Malaysian oil and gas company Petronas held a Head of Agreement (HOA) signing ceremony for the sale and purchase of gas to the Ca Mau - Vietnam area on March 15.
Attending the ceremony were representatives of Vietnam’s Government Office, the State Capital Management Committee, and the Ministry of Industry and Trade.
Petrovietnam was represented by Tran Sy Thanh, member of the company’s Party Committee and chairman of the board of directors.
He was joined by other members of the board of directors and the executive management board, and heads of different divisions and the administration office.
The attendees also included heads of such Petrovietnam units as Petrovietnam Power Corporation (PV Power), PetroVietnam Ca Mau Fertilizer Joint Stock Company (PVCFC), and PV Gas.
Petronas was represented by vice president Maliki Kamal Yasin, Muhammad Zamri Jusoh, vice director of the Petroleum Operations Management Committee, and some heads of division.
|Nguyen Quoc Thap, vice president of Petrovietnam, delivers a speech at the event.|
Representatives of Petrovietnam and Petronas signed the Head of Agreement in the presence of the two sides’ leaders.
In 2001, the Vietnamese government decided to invest in the construction of the Ca Mau Gas - Power - Fertilizer Complex in Khanh An Commune, U Minh District, Ca Mau Province to meet a demand for gas consumption of 2.2 billion cubic meters a year.
The Ca Mau Gas - Power - Fertilizer Complex uses natural gas from Block PM3CAA in the overlapping area offshore Vietnam and Malaysia.
From 2007 to now, the gas supply to this area includes the amount received under Petrovietnam's exploitation rights and the amount received from Petronas as per the Contract for Division of Products of Block PM3CAA (PSC PM3CAA).
Thanks to Petronas' close cooperation in the implementation of the gas sales contract, Petrovietnam is always given priority to maximize gas demand during the dry season and the Vietnamese company will receive support from its Malaysian partner to deal with excess gas in the dry season.
Therefore, during the past time, this modern complex in Ca Mau has operated safely and stably, bringing not only efficiency to Petrovietnam’s operations but also the economic and social significance for Vietnam’s Mekong Delta in the southwestern region.
|Maliki Kamal Yasin, vice president of Petronas, delivers a speech at the event.|
It is expected that from late 2019 and early 2020, the Ca Mau Gas - Power - Fertilizer Complex will only be supplied with gas sourced as per Vietnam’s exploitation rights in the area, resulting in a supply shortage of more than one million cubic meters a year.
Therefore, it is necessary to have additional gas sources for the Ca Mau Gas - Power – Fertilizer Complex to ensure energy security of the region in general and the economic efficiency of the facility in particular.
Under the close guidance of the Vietnamese government, the Ministry of Industry and Trade, and relevant ministries and sectors, Petrovietnam and Petronas agreed to sign an HOA for additional gas sales for the Ca Mau - Vietnam area, with supplies from the amount Petronas has the right to exploit in the area, and from other sources in Malaysia.
Under the agreement, both sides will continue to negotiate the Gas Sales Contract to supply additional gas for Ca Mau Gas - Electricity – Fertilizer Complex to continue stable and efficient operations.
The HOA signing not only reflects the vital meaning of Ca Mau Gas - Electricity - Fertilizer Complex but also ensures the socio-economic development of the southwestern region and plays an important part in ensuring national energy security.
|The signing ceremony marks a new development in Petrovietnam and Petronas relations|
Speaking at the signing ceremony, Petrovietnam vice president Nguyen Quoc Thap thanked Petronas leaders, relevant agencies of Malaysia, as well as the agencies of Vietnam and the two sides' negotiation teams for their effort to have worked for months to reach the final signature.
He affirmed that it was an important event that contributed to realizing and demonstrating the effective cooperation between Petrovietnam and Petronas.
The HOA closing was also an important ground for the two sides to continue to complete the full contract for additional gas sale and purchase to serve the operation of Ca Mau Gas - Power - Fertilizer Complex.
With the tradition of good cooperation as well as the results achieved in the HOA negotiation process, Petrovietnam wished that the full agreement will soon be signed, preferably by the end of 2019 to pave the way for the implementation in early 2020.
Petronas vice president Maliki Kamal Yasin also thanked the negotiation team and the leaders of the two countries.
He confirmed the signing was a good first step for the two parties to ink the next contracts.