Jadestone hands in development plan for project offshore Vietnam
Jadestone Energy has submitted the field development plan (FDP) for its Nam Du and U Minh gas fields, offshore southwestern Vietnam, to Vietnam Oil and Gas Group (Petrovietnam). The project is expected to be sanctioned later this year.
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 said on Monday that, following receipt of Petrovietnam’s endorsement, the FDP would be considered for approval by the Vietnam Government, expected to be received later this year. Approval from the government will constitute formal development sanction for the fields.
Jadestone previously said that it expected to make a final investment decision (FID) for its Nam Du and U Minh gas fields in the second half of 2019.
The company said it had recently achieved several project milestones leading up to the FDP submission.
This included submission of a formal declaration of commercial discovery for the two fields and finalization of the bidder selection process for the facilities engineering, procurement, and construction contract, culminating in a binding letter of intent being issued to the successful bidder.
It also included selection of a floating production storage and offloading vessel provider, including provisions for leasing, operations, and maintenance, now approved by Petrovietnam.
Furthermore, Jadestone said that another milestone was implementation of project management plans for the execution phase of the project, including health, safety and environmental management systems, and staffing the project organization; and receipt of amended investment licenses for both fields’ production sharing contracts, confirming the company’s working interest in Block 46/07 and Block 51 is now formally registered as 100%.
To remind, Jadestone Energy had a 70% operated working interest in Block 46/07 PSC. The process of amending Block 46/07 for PetroVietnam’s relinquishment of its 30% interest and withdrawal from the blocks with effect from May 1, 2017, resulted in Jadestone having 100% operated working interest.
As of December 31, 2017, the Nam Du and U Minh fields had gross contingent gas resources (2C) of 171.3 bcf. The company intends to begin a reserves audit process in the coming weeks, which, in addition to details of the final gas sales and purchase agreement (GSPA), will establish the 2P reserves the company will be eligible to record following development sanction and execution of the GSPA.
Paul Blakeley, President and CEO commented: “We have made significant strides toward our proposed southwest Vietnam gas development, with all key work streams progressing as intended. This is a major growth project for Jadestone and, with the submission of our field development plan, we now have a clear line of sight toward formal development sanction which is expected to be received later this year.
“In the meantime, our negotiations are progressing well toward finalizing a gas sales and purchase agreement in accordance with the heads of agreement signed with Petrovietnam earlier this year.
“The spirit of cooperation between Jadestone and the Vietnamese Government and regulator is strong, and we are working together to swiftly monetize this domestic resource, with targeted first production in late 2021. Nam Du and U Minh offer a material volume of gas for both Jadestone and for Vietnam and, once in production, will be used for existing installed power generation and the manufacturing of fertilisers, thereby directly contributing to Vietnam’s ongoing economic growth and development.”
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