This thread has been created to discuss the Vietnam assets. These currently consist of:
a) CNV - an operating field in block 9-2 with 155mn boe of gross 2P reserves
b) TGT - a field which is about to enter development. Gross 2p recoverable reserves of 300+mn boe (management think it will ultimately be closer to 500mn) should be confirmed soon, as the final government approval for the development plan is now very close.
c) TGD and the rest of the HPHT appraisal area - huge exploration potential of over 1bn boe P50 recoverable
d) VT appraisal area - a small discovery area likely to be relinquished
I'll fill in more details in due course.
ee
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SOCO International plc is an international oil and gas exploration and production company. The Company has oil and gas interests in Vietnam, which includes Block 9-2 and Block 16-1; Republic of Congo (Brazzaville), which includes Marine XI Block and Marine XIV Block, the Democratic Republic of Congo (Kinshasa), consists of Nganzi block and Block V and Angola, which include Cabinda Onshore North Block. The Company's operations are located in South East Asia and Africa. It holds its interests in the Republic of Congo (Brazzaville), through its 85%-owned subsidiary, SOCO Exploration and Production Congo SA (SOCO EPC). It holds its interests in the Democratic Republic of Congo (Kinshasa) through its 85%-owned subsidiary SOCO Exploration and Production DRC Sprl. The Company’s net entitlement volumes were approximately 15,500 barrels of oil equivalent per day. more »
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In reply to davjo, post #123
With respect I'd say that is far from "clear", given the predeliction of the press for misreporting precisely what has been said (especially if, as in this case, comments are translated).
For example - it wouldn't be inconsistent with production of 40,000 bopd this year (as an average from start-up, for example, or even as a maximum expected in 2011) to say that plateau production is expected to be 55,000 bopd and that the FPSO capacity is to be tested before year-end.
They might appear to be inconsistent at first glance - but they wouldn't be.
ee
..ps...there is also the potential for confusion with phase 2, for which SOCO's guidance is 40,000 bopd from August 2012
In reply to MadDutch, post #127
Come on MD! You know that is crap!
TGT is Miocene and Oligocene. TGD (which I assume you meant) is Oligocene (though there may well still be considered to be some potential in the underlying basement as well!).
No ee, not TGD. I do mean TGT, the one that is producing first oil right now.
AFAIAA TGT's basement has not been explored; and as an old geologist employed as a salesman in my family's diamond drill oil bit business once told me "you don't know what is there until you dig a hole."
Are you saying that basement oil is dependant on the geological age of the oil?
I think not but you are very welcome to prove me wrong.
MD
In reply to emptyend, post #129
ee, you do mention the potential for confusion between TGT and TGD; they dont just look the same, they even sound the same.
It occurs to me that some of the bad reporting and poor analysis may be due to the two acronym names getting mixed up and confused.
MD
In reply to MadDutch, post #130
Oh well, in that case you need to be clear about what is what.
TGT is a Miocene/Oligocene field ....period! There is no debate. That is how it is defined.
Now - if what you are saying is that there could be oil in the basement UNDER TGT, then that is true....but that is a different matter - and would be a different field.
IIRC (from the days when the basement in that area used to be referred to as "prospect H") there is a higher chance of a) gas and b) tight reservoir at H by comparison with the basement to the south. But, more relevantly, I can't see anyone trying to drill it in the next few years, unless it is considered to be linked to prospects in the HPHT appraisal area that includes TGD (and the jury will be out on that at least until the fresh seismic is done and analysed).
ee
In reply to emptyend, post #132
Thanks ee for your very helpful reply. I had assumed the license was based on the area, not the depth.
MD
In reply to emptyend, post #132
My understanding is that a basement oilfield is very unlikely to be tight. Please correct me if I am wrong;
A tight reservoir is likely to be a sedimentary deposit, where the particle (sand and / or clay) size is too small to allow oil to pass. A basement reservoir is in the contact zone between igneous and sedimentary and can contain a lot of oil in fissures. I remember a very nice seaside photo on TMF about 8 years ago, where the granite surface was exposed on the beach; there were lots of cracks up to several inches wide and many metres long; obviously capable of holding a great deal of free flowing oil.
So why am I bothering the busy people here? We are focused on what Soco VN is worth in a sale. If we were lucky and drilled a strongly flowing basement well in your separate oilfield under TGT, and given the close proximity to Bach Ho which has been a world class producer; our VN asset could be of interest to an oil major like Shell or BP. If not, the prospect of a vastly greater oilfield would certainly widen our market for the company.
The risk - reward ratio to a cash rich Soco looks good to me. I am offering this idea as a subject for debate.
MD
In reply to MadDutch, post #133
Just to be clear on that - the license IS based on the area (and therefore the participants own anything below in the same proportion). But the field name is specific to the miocene/oligocene.
Re the basement under TGT ....that is definitely going to be for "the next man". Not worth discussing and won't be drilled for years.
ee
Vietnam Announces 2011 Licensing Round
http://www.oilvoice.com/n/Vietnam_Announces_2011_Licensing_Round/af7df9048.aspx
.......PetroVietnam also offers a recently improved legal framework and investment conditions to encourage increased petroleum exploration in the country.
Excellent! There's always a sneaking worry that the VN authorities might eye up Soco's advantageous terms set in the days of $15 oil and try to whittle down their netbacks (before Soco gets the chance to sell the assets). However, doing so wouldn't exactly sit well with their policy of attracting new investment would it?! ;-)
I hope that if SOCO bids for the new licences they will do so through another company (not soco vietnam),
so that the current assets can then be sold off seperately from any new blocks,
K
Talking of netbacks.
I was wondering if anyone knows the rate of interest that is paid to Soco by the other partners for the repayment of their capex invested in the exploration and development. of the VN fields
Must be a tidy sum.
Samurai
In reply to Samurai, post #138
9%....and it has been accumulating for over 10 years. That is only the minority partner of course - PV doesn't pay interest on their carry.
Not a reporting source that I would care to rely on 100%, but it was apparently claimed by the General Manager of Hoang Long JOC at a first oil ceremony yesterday that TGT production is already running at 42,800 bopd.......
...which, if true, should be giving the doubters pause for thought...... ;-)
IMO that indicates a pretty quick and trouble free ramp-up (so far!)
ee
That is fantastic news if true ee.
Great spot.
Wow that would be fantastic news, certainly would make sense to under promise and over deliver
I wonder when we'll hear an update from soco on TGT production ?
K
In reply to emptyend, post #140
Interesting. Since they ramped up from 16kbopd on the 24th Aug to 28.5kbopd on the 7th Sept a further step up to about 42kbopd now seems entirely possible.
I note that production plan calls for a plateau at about 40kbpod, while production facilities are tested etc, so we should presumably not expect any further significant step up for a while yet. Though getting to this stage so quickly, and apparently smoothly, must be good news - quite apart from the revenue!
In reply to emptyend, post #140
Nice work ee, thank you.
MD
.... from the sunny Cap d'Agde, sky grey as lead right now!
In reply to emptyend, post #140
EE
thanks for that
I note that report says "....Half a million barrels of crude oil valued at US$60 million are being traded from the Armada Te Giac Trang 01 FPSO (floating, production, storage and off-floating vessel) to international clients....."
which implies a price of $120/bbl
which seems quite handsome to me
T
In reply to tournesol, post #145
Well I'm sure there is a rounding error in there, but since we know that the last cargo is reported to have sold at $2 over Minas....and we know that Minas is $5-6 over Brent....and we can all see where Brent trades.....it is clearly selling in the vicinity of $120 currently.
ee
In reply to emptyend, post #146
Cross-posting from ADVFN for reference:
It is worth noting, for those who care about fundamentals, that the USD has moved from c. $1.65 to under $1.55 over the last month.....which is a shift of 6% or so. In contrast, Brent has gone down by only around 3%.
Incidentally - this seems a useful source of very recent prices for Minas in the Far East...confirming that Minas was at $112.75 yesterday for November delivery in Tokyo (I guess it would be c. $3 lower today)
On the basis of yesterday's numbers I guess that TGT crude would be c $115-116 (Brent-Minas spreads having apparently narrowed recently, assuming data sources are comparable)......
....but because of the USD/GBP FX move there is probably little change in GBP terms.
ee