Vietsovpetro: Mainstay of Vietnam Oil & Gas

Obviously, Vietsovpetro has made great contributions to socio-economic development in Vietnam for years. Could you please make a brief on the joint venture’s operations?

Vietsovpetro was set up in line with the Intergovernmental Agreement between Vietnam and former Soviet Union on June 19, 1981. Vietsovpetro started operation on November 19, 1981 and it has been operating in oil and gas exploration and production on Vietnam’s continental shelf for nearly 28 years.

Vietsovpetro has paid due attention to building infrastructure for oil and gas exploration and production in southern Vietnam since its first operations.

The joint venture started probing in Bach Ho oilfield in 1983 and found first oil flow in May of 1984. Then, Vietsovpetro quickly carried out designing and building oilrigs to start commercial production at the field on June 26, 1986, marking a breakthrough in Vietnam’s oil and gas sector. Vietsovpetro’s operations have strengthened friendship between Vietnam and Russia.

Vietsovpetro found oil in Rong (Dragon) field in June, 1985 and found an oil bed at weathered rocks in the Bach Ho oilfield in May, 1987, making the world surprised. This important achievement was a key and firm foundation for Vietsovpetro to hike its oil and gas production and reach a record output of 13.5 million tonnes in 2003.

The joint venture found Dai Hung (Great Bear) oilfield in 1988 in addition to a wide range of other fields like Ba Vi, Ba Den and Soi.

Vietsovpetro has been ever growing and making new records as well as making great contributions to Vietnam’s oil and gas sector.

Vietsovpetro expects to earn revenues of US$45.5 billion from crude oil trading through end-2009 and pay taxes of US$30 billion, accounting for between 15 percent and 22 percent of Vietnam’s annual state budget revenues.

Leaders of Vietnam and Russia all have paid due attention to Vietsovpetro’s operations. During his visit to Vietsovpetro, General Secretary Nong Duc Manh hailed Vietsovpetro’s contributions to Vietnam’s economic development for years. He noted that the joint venture is still a mainstay of Vietnam’s oil and gas sector and is a core force to build the Vietnam Oil and Gas Group (PetroVietnam), industry sector and a spearhead in the national industrialization and modernization.

Meanwhile, during his visit to Vietnam in 2006, former Russian President Putin told that Russia praised bilateral cooperation between Vietnam and Russia, which is proved by efficient operations by Vietsovpetro. Russia wanted to further strengthen the cooperation ties with Vietnam within the framework of the agreement on Vietsovpetro as well as facilitate the joint venture to expand its operations in Vietnam and in third countries. “Vietsovpetro is the best Russian joint venture abroad,” Putin noted.

Vietsovpetro always pays due attention to humanitarian operations. The joint venture has donated over US$30 million to build infrastructure, schools, hospitals and cultural and historic relics in Ba Ria-Vung Tau province as well as nationwide. With contribution of Vietnamese and Russian officials, Vietsovpetro has granted billions of Vietnamese dong to building schools and charity houses as well as taking care of Vietnamese heroic mothers, poverty reduction, and natural disaster reliefs.

Vietsovpetro has been honoured with title “Labour Hero of Renewal” twice and a wide range of noble medals by the government of Vietnam. It was bestowed with Ho Chi Minh Medal in June 26, 2009 by President Nguyen Minh Triet.

Vietsovpetro is speeding up preparations to transform into two-member limited company after 2010. Could you please give some details about it?

Vietnam and Russia governments have agreed to transform Vietsovpetro into a two-member limited company after December 31, 2010 with PetroVietnam holding a 51-percent stake and OAO Zarubezhneft 49 percent. Then, the company will continue to specialize in oil and gas exploration and production and related services in Vietnam and third countries. The company will operate under a holding company to continue its current operations in Rong and Bach Ho oilfields at block 09-1 on Vietnam’s continental shelf and at blocks 04-3 and 04-1 under product-sharing contracts.

Could you please mention some Vietsovpetro’s targets and directions in years to come?

Vietsovpetro will focus on major operations through 2015 and a vision to 2025 as following:

Firstly, continuing to take advantages of modern technologies to boost oil and gas production at Bach Ho and Rong oilfields as well as start commercial production at new fields at block 04-3 and Nam Rong-Doi Moi field.

Secondly, boosting oil and gas exploration in Vietnam’s deep waters, initially at blocks 04-1, 04-2, 05-3, and 135/138 as well as quickly apply advanced technology and equipment and facilities to exploration and production activities in these fields.

Thirdly, extending oil and gas exploration and production overseas, particularly in Russia and in countries belonging to former Soviet Union as well as actively join PetroVietnam’s projects in Africa, South America and regional countries.

Fourthly, boosting domestic and overseas oil and gas services; expand its operations to building oilrigs and floating facilities to serve its business as well as increasing market’s demand.

Posted by VBN on Dec 1 2009. Filed under Enterprises. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry