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Vietnam will exploite the first commercial oil flow in Algeria by July, 2015

Vietnam will exploite the first commercial oil flow in Algeria by July, 2015 - 

On June 2nd, 2015  Morning (local time), Vietnam Prime Minister Nguyen Tan Dung and Algeria Prime Minister Abdelmalek Sellal  visited the National Petroleum Company Algeria (Sonatrach) – a  partner of the Vietnam National Oil and Gas Group (PVN) in the joint venture company for exploiting  Bir Sebaar  and MOM Oil Mines at the  433a and  416b lots in Algeria's Sahara desert.

The presence of the Algeria Prime Minister Abdelmalek Sellal and Vietnam Prime Minister Nguyen Tan Dung at Sonatrach headquarter showed a special respect and concern of the two governments for this project.

With the official declaration for exploiting the first commercial oil by early July, this Petroleum Joint Venture exploitation is a successful cooperation symbol between Vietnam and Algeria and, at the same time, it remarkes the success of the one among the largest oversea petroleum investment projects of PVN.

The success of the project also creates a new prospect for economic, trade and investment cooperation between Vietnam and Algeria.

The contract of the joint venture project in the 433a and 416b lots was signed on July 10, 2002 between the PetroVietnam Exploration and Production Corporation (PVEP) and the National Petroleum Company Algeria (Sonatrach). The capital share proportion of the project is 75% of Vietnam and 25% of Algeria

On February 10, 2009, PVEP, Sonatrach and Thailand Petroleum Exploration and Exploitation (PTTEP) signed a joint venture agreement on petroleum development with a USD 1.26 billion total investment, which divides 40% for PVEP, 35% - PTTEP and 25% - Sonatrach.

In development process, the joint venture has defined in place an oil reserve of around 150 million ton equivalent to 1 billion barrels (exceeding the expected amount), with the North Sea oil quality.

The joint venture will exploit the first commercial oil flow from the Bir Sebarr and MOM mines by July 2015 with a production of 2,900 ton per day (equivalent to 20,000 barrels). The production will rise up to the top rate of 5,800 tons per day (approximately 40,000 barrels) in 2018 – 2021years.

If averagely accounting that these mines will achieve a production of 1.1 million tons per year (for comparison, in 2014 Vietnam exploited nearly 17 million tons), after a 25 year exploiting period the joint venture will have a commercial oil production of 30 million tons (equivalent to 200 million barrels).

According to PVN, with a 40% share in the joint venture, Vietnam side will obtain from US$ 100 to 150 million turnover per year from oil sales and the investment capital for the project would be returned for about the 6 years. Especially on this occasion, Algerian government has also agreed the proposal of Prime Minister Nguyen Tan Dung to hand the joint venture company to favorably exploit the neighboring mines. With a probe reserve of 150 million tons (1 billion barrels), additional exploiting new mines will bring to joint venture company a large production and turnover.

Speaking at the Ceremony for publishing the first commercial oil flow in Bir Sebaar and MOM mines, Prime Minister (PM) Nguyen Tan Dung confirmed that the Joint venture PVEP-Sonatrach- PTTEP official exploiting the first commercial oil flow will bring benefit for the both petroleum enterprises and the both countries. "This is a symbol of successful cooperation between the two countries, and the results of firm and long term cooperation between Vietnam and Algeria enterprises, and will be a practical contribution to strengthening traditional friendly relations and good cooperation between the two countries; creating a dynamic for both parties to continue to expand cooperation in many new fields, "- Prime Minister Nguyen Tan Dung stated.

Prime Minister Nguyen Tan Dung high valued the effort and the firm, enduring and arduous labor of Vietnamese and Algerian cadres, engineers and workers in recent ten years for achieving today fruits. Congratulating initial success of petroleum companies of the two countries, the Prime Minister Dung expressed a desire for two sides to continue close cooperation to ensure the effective exploitation. The PM Dung also disclosed that Algerian government has supported Petroleum Groups of the two countries to get more new mines in future. Regarding itself, the Vietnamese government will support and create the comfortable conditions for petroleum groups of the two countries to carry out the petroleum exploring and exploiting activities on Vietnamese continental shelf and in the third country, as well.

Prime Minister Nguyen Tan Dung at the Ceremony.

At Sonatrach headquarter, PMs Nguyen Tan Dung and Abdelmalek Sellal witnessed for the signing ceremony of strategic cooperation agreement between Petrovietnam and Sonatrach.

Algeria is a country of oil strong potential with an estimate reserve of about 5.7 billion ton (38 billion barrels), a production of nearly 180,000 tons per day (1.2 million barrels), ranking in the world as the thirteenth place by the production output and the ninth place by the export output. Algeria is the one among the three leading oil producers in Africa.

Algeria is also a large gas producer with a reserve of approximately 4,500 billion cubic meters and a production of 60 billion cubic meters per year. Algeria is a leading country of natural gas production in Africa, the second largest natural gas exporter to Europe's market and the forth largest in the world.

VietnamEnergy.vn

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