The Bi aN Phia Nam field has the potential to become very successful enterprise for ELEN Oil as well as for Petrovietnam.
The majority of the risks and uncertainties are certainly manageable. The steps taken in this report show that it is possible to generate a feasible solution that meets the demands of all parties involved.
The engagement with relevant stakeholders plays an important role in this. Any solution that fails to do so is likely to meet some serious obstacles later on.
Where reliable predictions of future events are more challenging, as with the political developments of the region, it is still possible to generate solutions that accommodate these uncertainties. This should be clear from the proposal at hand.
As stated in the chapter 2, Vietnam’s energy consumption has been growing at an average rate of 12% per year in the past decade. Gas demand is increasing more rapidly as easy coal reserves in the country are depleting. Existing gas power plants are already in shortage of gas (Thanh, 2011) while at the same time more gas power plants are planned (PVbPower, 2012). Vietnam’s power plants alone will need 16.3 Bcm of gas by 2015 and about 50 Bcm by 2020 if the capacity of gas power plants rise by 5 times as is planned.
Given the gas demand in the region and the availability of gas fields (24.7 Tcf estimated reserves in Vietnam), great opportunities rise for developing gas fields or investing in pipelines. ELEN Oils strategy should focus on gas. Three steps are suggested that aim on establishing ELEN Oil in the Vietnamese market and offering ground for expansion.
Step 1: Two more prospects exist in block 21 (see Figure 6b1). ELEN Oil could try to develop those along with the development of Bí ẩN Phía Namb1 field and the Em traib2 field.
Step 2: Blocks 21 and 11 are amongst the blocks offered in 2011b2012 offshore licensing round of Vietnam. Blocks 28 and 29 have already been awarded but not yet developed. The fields within those blocks contain mainly gas. Using the proposed new gas pipeline that can transport the anticipated production form those fields will have not only economic benefits from the pipeline’s revenue but it will also strengthen ELEN Oil’s position in the area. For example, ELEN Oil can ask as a condition for renting its pipeline to participate in the development of a field that considers to tiebin the pipeline.
Step 3: Acquiring license to develop nearby fields in Block 12 that have not been offered in a licensing round so far. Vietnam has a procedure that allows to acquire a license with an individual offer and this can be more feasible after ELEN Oil builds a good reputation in Vietnam with the development in Block 21
The most important partner is PetroVietnam (PVN). It is the largest enterprise in Vietnam with long experience in oil and gas and a sound economic status. It is familiar with all government development plans and it manages the licensing procedures in Vietnam on behalf of the government. PVN has the capacity to buy the produced gas for its downstream business and power generation plants.
Moving to deeper waters, will increase the influence of ELEN Oil in future projects since its experience would be invaluable to PetroVietnam at