Houston-based integrated energy company ConocoPhillips has entered into an agreement to sell its Vietnam business unit to a subsidiary of Perenco for a total of $1.29 billion plus customary working capital adjustments.
ConocoPhillips will sell its three wholly-owned subsidiaries that separately hold its 23.25% participating interest in Block 15-1, 36% participating interest in Block 15-2, and 16.3% participating interest in Nam Con Son Pipeline to the French oil and natural gas company affiliate in a transaction expected to close in the first half of 2012.
Block 15-1
Block 15-1 is located in the Cuu Long Basin and is operated by Cuu Long Joint Operating Co. Production from its Su Tu Den Field began in late 2003. Production from the Su Tu Vang Field began in 2008. First production on the Su Tu Den Northeast Field occurred in May 2010, averaging net 4 MBD of oil. Co-venturers are PetroVietnam (50.0%), ConocoPhillips (23.3%), KNOC (14.2%), SK Corp. (9.0%), and Geopetrol (3.5%).
Block 15-2
The Rang Dong Field is located in Block 15-2 in the Cuu Long Basin. Rang Dong crude oil is stored in the MV-17 FSO, where it is offloaded to tankers for export. Japan Vietnam Petroleum Co. serves as operator with 46.5% and co-venturers are ConocoPhillips (36.0%) and PetroVietnam (17.5%).
Nam Con Son Pipeline
The Nam Con Son Pipeline is a 700-MMCFD, 244-mile transportation system linking natural gas supplies from the Nam Con Son Basin to markets in southern Vietnam. The infrastructure consists of a 26-inch diameter, 227-mile offshore pipeline segment delivering wet gas to the gas plant located at Dinh Co, Ba Ria-Vung Tau province. The gas is conditioned to meet sales specifications and is redelivered via a 30-inch-diameter, 17-mile onshore pipeline segment to the Phu My gas distribution center. PetroVietnam serves as operator with a 51% holding with co-venturers BP (32.7%) and ConocoPhillips (16.3%).
"The sale of our Vietnam business unit is an important component of our $15-20 billion 2010-2012 asset divestiture program. ConocoPhillips has conducted business in Vietnam for more than 15 years, and we are pleased that Perenco has recognized the value of these quality assets," said Al Hirshberg, senior vice president, Planning and Strategy, ConocoPhillips.
For 2010-2011, ConocoPhillips’ asset divestiture program yielded $10.7 billion in proceeds, in addition to $9.5 billion from LUKOIL share sales, giving total dispositions of $20.2 billion over this period.
HSBC Securities (USA) Inc. acted as the Sole Financial Advisor to ConocoPhillips on the sale.
Perenco is an independent oil and gas company with operations in 16 countries, ranging from Northern Europe to Africa and from South America to the Middle East. Perenco is involved in operations both onshore and offshore.
