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Australian Worldwide focuses on Vietnam after buying oil area
Australian Worldwide Exploration Ltd. is concentrating on Vietnam and looking at investments there after buying a stake in an offshore oil exploration development in the country.
“Looking broadly at Vietnam and the opportunities there, Vietnam is now a focus area for the company,” Australian Worldwide managing director Bruce Wood said in a telephone interview Wednesday. “We’re putting our technical teams to work on Vietnam now.”
This week Australian Worldwide agreed to buy a stake in Block 06/94 from UK-based Serica Energy Plc. A unit of Abu Dhabi-based Mubadala Development Co. and a unit of Sweden’s Lundin Petroleum AB also own shares in the block.
The government is trying to attract investors to offshore areas in a bid to reverse a four-year slump in production. JPMorgan Chase & Co. predicted last year that Vietnam would boost output in 2009. The nation’s crude oil exports rose 22 percent to 4.26 million tons in the first quarter, or about 355,000 barrels per day, according to government figures.
Block 06/94 is in the Nam Con Son Basin, about 250 miles off the coast and adjacent to an area where a group led by BP Plc is producing natural gas. The area is also adjacent to one where Premier Oil Plc has found oil, Australian Worldwide said in a March 23 statement.
Oil prospect
“There’s proven oil generation in the block next door and we’ve looked intensively at our block, and we believe strongly there’s an oil story there,” Wood said. “Our fundamental focus is oil exploration, but we recognize there’s also a significant possibility of gas. But we think there’s a good chance for oil.”
A prospect on Block 06/94 has “unrisked gross potential resource” of 159 million barrels of energy, Lundin said last month.
The move comes amid a flurry of recent activity in Vietnam’s oil industry.
Total SA signed a contract to explore two onshore blocks in Vietnam’s Mekong River Delta last week. Salamander Energy Plc said Wednesday it has completed seismic work on a Mekong River Delta block it plans to drill in 2010 and that it will also drill offshore Vietnam in 2010, while Premier said Wednesday that its exploration focus for 2009 is in Vietnam.
The global economic situation is benefiting Australian Worldwide in its plans to expand in Asia, Wood said. The company currently also has interests in production or exploration areas in Australia, Indonesia, New Zealand and Yemen.
“In the current downturn, we can enter into projects more cheaply than we could have previously,” he said, declining to say how much Australian Worldwide will pay for its stake in Vietnam. “We have no debt and a strong balance sheet, so we can move in where previously there was more competition, driven up by companies that were using debt financing.”
Bloomberg, Thanh nien
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