Valeura Energy strikes a deal with PTTEP to expand its Thai oil & gas footprint

Canada-based Valeura Energy, an oil and gas company, has made a move to acquire partial stakes from Thailand’s national oil and gas player, PTT Exploration and Production Public Company Limited (PTTEP), in two offshore blocks off the coast of Thailand.

This farm-in agreement with PTTEP enables Valeura to secure additional offshore acreage in the Gulf of Thailand by acquiring a 40% interest in blocks G1/65 and G3/65, which will boost its gross acreage position in Thailand from 2,623 square kilometers to 22,757 square kilometers.

The Canadian player claims that these blocks are strategically positioned next to some of its oil fields and Thailand’s largest producing gas fields. The 15 oil and gas discoveries on the blocks are said to be supported by 27 wells that encountered oil and gas pay.

As a result, the company believes that existing discoveries and exploration prospects can be tied back quickly to existing oil and gas infrastructure. While exploration and appraisal work is already underway, 3D seismic acquisition is planned to start in the coming months.

Dr. Sean Guest, President and CEO, commented:“The spirit of collaboration between Valeura and PTTEP is strong, and we are excited to begin work on this vast swath of prospective acreage in the Gulf of Thailand with the potential for both near and long-term natural gas and oil developments. PTTEP has an unparalleled depth of knowledge in Thailand and a proven track record of exploration and development success both in Thailand and throughout the Southeast Asia region. 

“Acquiring an interest in these blocks increases our acreage in the offshore Gulf of Thailand substantially, and provides us with existing discoveries and attractive exploration prospects immediately adjacent to several world class gas fields and our producing oil assets. Both blocks already contain existing discoveries, and new exploration drilling has commenced in 2025, aimed at confirming sufficient gas and/or oil volumes for installation of new platforms that can be tied back to existing infrastructure.”

Following the completion of the farm-in, subject to the approval of the government of Thailand, Valeura will have a 40% working interest in the two blocks, with PTTEP holding the remaining 60% and continuing to operate both assets. The duo has agreed to a work program for 2025 that includes drilling four exploration wells, all recently completed, and acquiring just over 1,200 square kilometers of new 3D seismic data.

The Canadian firm will pay 40% of the actual back costs of around $14.7 million to June 30, 2025, which include the recently completed four-well 2025 drilling program, geological and geophysical studies, production sharing contracts (PSCs) signature bonuses, and general and administrative costs incurred since the blocks were awarded in March 2023.  

In addition, Valeura will carry PTTEP on an additional seismic acquisition it requested of approximately 165 square kilometers on Block G3/65, located to the northeast of the Nong Yao field, capped at $3.7 million (gross). Regarding all costs thereafter, each company will pay its respective pro rata share.

The PSCs’ fiscal terms include a royalty payable to the Thailand government at 10% of gross revenue, provisions for cost recovery up to 50% of gross revenue, and profits afterward shared 50-50 between the government and the contractor. The corporate income tax rate on contractor net profit is 20%.

These PSCs provide for a six-year exploration period, during which eight wells need to be drilled, five on G1/65 and three on G3/65, and 800 square kilometers of 3D seismic needs to be acquired, 500 square kilometers in G1/65 and 300 square kilometers in G3/65, before the end of the exploration period in May 2029.

According to Valeura, a three-year extension to the exploration period may be provided thereafter, while fields developed under the PSC regime are given a 20-year production period, with a potential ten-year extension thereafter.

Guest added: “While our initial focus is on pursuing these near-term development opportunities, there are also higher-risk/higher-reward prospects which we plan to explore, with the objective of building out a pathway for longer-term growth. Our intent is to both expand and diversify our business both organically and inorganically. 

“This farm-in furthers that goal by layering in low cost, infrastructure-led exploration, while also adding gas developments within a welcoming jurisdiction that has prioritised energy development to fuel its growing economy. We see this farm-in and strategic partnership with PTTEP as an excellent opportunity to drive further value generation for our stakeholders.”

Comprising a gross area of 8,487 square kilometers, Block G1/65 is situated immediately south of Valeura’s B5/27 block with the firm’s operated Jasmine and Ban Yen fields and west of PTTEP-operated Erawan, Platong, and Benchamas large gas fields, currently producing 900 mmcf/d, 27 mbbls/d condensate, and 23 mbbls/d oil, respectively, based on May 2025 production data disclosed by Thailand’s Department of Mineral Fuels. 

Block G1/65 is approximately 240 kilometers long, covering the northwestern flank of the Pattani basin, said to be the most prolific basin in the Gulf of Thailand, and encircles the Rossukon oil field. This block entails eight oil and gas discoveries, supported by 12 wells that encountered oil and gas pay, as well as several undrilled prospective trends. 

PTTEP and Valeura have high-graded two focus areas on Block G1/65, which will guide their initial work program. The first one is the Jarmjuree South area, a liquids-rich gas and oil-bearing structural trend between the producing Benchamas and Platong fields, which is believed to be substantially de-risked by four wells that confirmed the accumulation of both oil and gas in multiple stacked reservoir intervals. 

PTTEP recently completed a three-well appraisal drilling campaign to further delineate the opportunity, and to date, one well has been disclosed by the Department of Mineral Fuels to have encountered gas pay. Valeura anticipates that field development planning will follow in the near term.

The second focus area is Maratee-Bussaba, which lies immediately south of the Rossukon oil field and contains a three-way closure structure as well as several combined structural/stratigraphic traps identified as drilling candidates, based on existing 3D seismic data over the area.

Taking into account nearby producing fields and discoveries in the vicinity, the firm expects the trend to be an oil-prone fairway; thus, the planned 3D seismic acquisition on Block G1/65 will focus on the western portion of the Maratee-Bussuba area to better image the reservoir in support of further exploration drilling in this area.

Block G3/65, encompassing a gross area of 11,647 square kilometers, bounding Valeura’s G11/48 block in the north, where the Nong Yao field is located, is immediately west of the large PTTEP-operated Bongkot gas field, which currently produces 850 mmcf/d gas and 24 mbbls/d condensate, based on May 2025 production data. 

The approximately 200-kilometer-long block, encapsulating the northwest flank of the North Malay basin, has seven identified oil and gas discoveries, supported by 15 wells with oil and gas pay. Among Block G3/65’s two key focus areas, which will guide the initial work program, is Nong Yao North-East, believed to contain an oil-bearing fairway between the company’s Nong Yao field and the undeveloped Ubon oil field to the north.

As the area is expected to be covered with 3D seismic in 2025 to accurately define the prospects, Valeura anticipates the start of exploration and appraisal drilling to follow in its wake. The firm’s objective is to determine whether this area or the Nong Yao-D discovery from 2024 is better placed as the next tie-back development to its operated processing infrastructure on the Nong Yao field.

The second focus area is Bussabong-Angun, which is situated immediately west of PTTEP’s Bongkot gas field and thought to contain extensive gas accumulations, as substantiated by multiple existing gas discoveries. PTTEP recently drilled an exploration well to fully validate the Bussabong opportunity, which encountered gas pay. 

“The Bussabong discovery is a prime candidate for a fast-track gas development, potentially resulting in the company’s first gas reserves in Thailand. Valeura is optimistic that development planning will progress at pace, and after completion of the farm-in, the company intends to provide further disclosure on next steps for the Bussabong gas accumulation,” underlined the Canadian firm.

𝐆𝐫𝐚𝐛 𝐭𝐡𝐞 𝐚𝐭𝐭𝐞𝐧𝐭𝐢𝐨𝐧 𝐨𝐟 𝐲𝐨𝐮𝐫 𝐭𝐚𝐫𝐠𝐞𝐭 𝐚𝐮𝐝𝐢𝐞𝐧𝐜𝐞 𝐚𝐧𝐝 𝐮𝐧𝐥𝐨𝐜𝐤 𝐬𝐚𝐯𝐢𝐧𝐠𝐬 𝐢𝐧 𝐨𝐧𝐞 𝐦𝐨𝐯𝐞 ⤵️

𝐇𝐮𝐫𝐫𝐲 𝐮𝐩 𝐚𝐧𝐝 𝐭𝐚𝐤𝐞 𝐚𝐝𝐯𝐚𝐧𝐭𝐚𝐠𝐞 𝐨𝐟 𝐨𝐮𝐫 𝐰𝐢𝐧-𝐰𝐢𝐧 𝐬𝐮𝐦𝐦𝐞𝐫 𝐬𝐚𝐥𝐞 𝐝𝐢𝐬𝐜𝐨𝐮𝐧𝐭 𝐨𝐟 𝐮𝐩 𝐭𝐨 𝟓𝟎% 𝐨𝐧 𝐚𝐝𝐯𝐞𝐫𝐭𝐢𝐬𝐢𝐧𝐠 𝐩𝐚𝐜𝐤𝐚𝐠𝐞𝐬 𝐛𝐲 𝐉𝐮𝐥𝐲 𝟑𝟏!

ADVERTISING OPTIONS