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AIM-listed and Singapore-headquartered oil and gas player Jadestone Energy has sealed a deal with PV Gas, a subsidiary of Vietnam’s state-owned national energy group Petrovietnam. This unlocks the doors for the development of gas discoveries off the coast of Vietnam, Southeast Asia.
Jadestone Energy has signed a gas sales and purchase agreement (GSPA) for the supply of gas from the Nam Du / U Minh discoveries offshore Vietnam, following the Vietnamese government’s approval of the field development plan (FDP) for these discoveries.
T. Mitch Little , Chief Executive Officer of Jadestone, commented: “The execution of this agreement is a pivotal moment for Jadestone. After years of dedicated effort, we are now in a position to deliver the Nam Du/U Minh development, which will materially strengthen our portfolio while supporting our growth ambitions.
“With all key commercial and technical approvals now in place, and recent key hires into the Jadestone Vietnam project delivery team, we are now focused on rapidly progressing towards the project execution phase. Our near-term priorities are to conclude the bid evaluation for the FPSO and field infrastructure, and award their respective contracts during the second half of this year.”
The finalized GSPA sets out the terms on which gas will be supplied from the Nam Du/U Minh fields to PV Gas, with the key elements encompassing a daily contract quantity (DCQ) of 80 million standard cubic feet (scf) per day, or around 13,000 boe/d (gross), maximum DCQ set at 110% of DCQ, take-or-pay is set at 90% of DCQ, equivalent to approximately 26 billion scf per year during the plateau period.
According to Jadestone, the wellhead gas price is comparable to historical Vietnam gas imports and subject to fixed annual escalation. The Nam Du/U Minh discoveries are located offshore southwest Vietnam in shallow waters, with production targeted to start in late 2028. These fields contain independently audited gross 2P reserves of 32 million boe.
The company estimates up to 1.5 trillion cubic feet of gross unrisked gas in place from seismically supported prospects within the existing licenses, much of which lies in proximity to these fields, representing low-risk upside potential which could extend and/or increase plateau production from the initial development.
Little added: “Over the project life, we expect that the development and production phases will generate significant local employment opportunities, material contract awards to local Vietnam companies, and hundreds of millions of dollars in government revenues.
“The Nam Du/U Minh project also supports Vietnam’s strategic plan and net zero ambitions, prioritizing sovereign resources to enhance Vietnam’s energy security and economic growth alongside the transition to lower emitting sources of fuel.”