Cambodia's first oil to be delayed, official says
Cambodia is unlikely to produce its first hydrocarbons until 2010, according to a senior government official.
Oil Diplomacy Editor
LOS ANGELES, Nov. 4 -- Cambodia is unlikely to produce its first hydrocarbons until 2010, according to a senior government official.
Ho Vichit, vice-chairman of the Cambodian National Petroleum Authority, said his country has been anxious to tap its hydrocarbon resources, but the Chevron Corp.-operated Block A is unlikely to be on stream before that date at the earliest.
"Chevron is planning to do more exploration and appraisal. By the end of the year, they will submit a development plan," Ho told reporters on the sidelines of an energy conference in Singapore.
"It's premature to speculate how much oil or natural gas can be pumped from offshore Block A," Ho said at the Asia Oil and Gas Investment Congress.
"It must be recognized that hydrocarbons shows alone do not make…an oil or gas field, let alone an oil or gas field that might be viable for commercial development," said Ho.
Ho said there are some "technical challenges" to overcome and that "based on exploration results, it's most likely that a mix of low-sulfur waxy crude and some gas will be produced."
Hopes about the field's prospects were raised last year when the International Monetary Fund forecast recoverable reserves from Block A at 500 million bbl, with the first of three fields expected to start production in 2011.
The IMF predicted a $15 billion windfall for the Cambodian government from royalties and taxes over the life of the fields.
In March of this year, Chevron downplayed speculation about start-up dates for the field.
"As of early 2008, Chevron and the Block A participants are still evaluating development options for Block A, and therefore it would be too early to speculate on costs or schedules for the project," said Chevron spokesperson Nicole Hodgson.
In 2002 the Cambodian government awarded Chevron Overseas Petroleum (Cambodia) Ltd. a concession for the exploration and production of oil and gas offshore on Block A.
In 2005, COPL discovered oil in four exploration wells on Block A. Oil pay logged in the wells was 41-139 ft. Analysis of crude samples indicated the oil to be 44°.
A 5-well exploration and appraisal program was completed in 2006 and was followed by the exploration and appraisal of four more wells in 2007.
Chevron last year issued a downbeat assessment of the block, after its second drilling campaign revealed challenges, with hydrocarbons being dispersed rather than in one core field.
The company said it planned a third drilling campaign for late 2008-09.
Chevron operates Block A and holds a 55% interest, while Mitsui Oil Exploration holds 30%, and South Korea's GS Caltex has 15%.
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