Jadestone awaits approval for Vietnam development plan to shift into high gear
Jadestone Energy expects approval for its development plan for the Nam Du and U Minh gas fields, offshore southwest Vietnam, to happen shortly.
The Nam Du discovery is located within the Block 46/07 PSC on the north-eastern margin of the Malay-Tho Chu Basin, approximately 200 kilometers offshore Vietnam in a water depth of 47.9 meters.
Jadestone submitted the field development plan (FDP) for its Nam Du and U Minh gas fields to Vietnam Oil and Gas Group (Petrovietnam) in October 2019 and the project was expected to be sanctioned later in 2019.
The company said in an update on Tuesday that the FDP for the Nam Du and U Minh gas fields was in the final stages of the formal Vietnamese Government approval process.
Jadestone continues to anticipate the final approval of the FDP, which includes approval of the gas price, shortly.
FDP approval constitutes official project development sanction, and there are no further regulatory or permit consents to start construction and ultimately deliver hydrocarbon production.
According to the company, detailed engineering and procurement activities have started, in connection with the development, which remains on schedule for first gas production in late 2021.
Further commercial arrangements relating to the sale of gas from the project are being incorporated into long-form documentation with the buyer, in accordance with a Heads of Agreement signed in 2019. The company expects to execute a gas sales and purchase agreement in the coming months, after the gas price is approved, as part of the FDP approval.
All major contracts and other commercial arrangements relating to the project are in final form, and ready for execution upon project sanction. These include a facilities EPC contract, an FPSO lease and related O&M contract, a joint development agreement for the two fields, and a tie-in services agreement for the connection into the Ca Mau pipeline.
The company is tendering the transportation and installation work and the drilling rig and long leads, which are planned for contract award in 2Q 2020.
Paul Blakeley, President and CEO commented: “Our southwest Vietnam gas development project will shift into high gear immediately upon field development sanction, including the award of a number of major procurement streams. The project team are maintaining schedule with selective long-lead orders while the FDP continues to work its way through Vietnam government approvals. Once approved, this project provides strong short-term growth, diversifies our portfolio with fixed price gas and, when it comes on stream, predictable cash flow at a time of significant oil price volatility.”
Offshore Energy Today Staff
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