PetroVietnam to Sign Upstream Crude Oil Deal with Rosneft

State-owned PetroVietnam and Rosneft are expected to sign two upstream pacts and a crude oil sales deal during Russian President Vladimir Putin to Vietnam early next month, PetroVietnam said Wednesday.

One is to do with PetroVietnam’s participation in the South Russky block in the Pechora Sea and West Matveyevsky in the Barents Sea. Also on the anvil is a memorandum of understanding on Rosneft’s acquisition of a 20% stake in the 15-1/05 block in Vietnam’s Cuu Long basin and another MOU on Rosneft supplying crude oil to PetroVietnam from 2014-2016.

PetroVietnam Chairman Phung Dinh Thuc and Rosneft’s CEO Igor Sechin have agreed to ask their working groups to speed up the negotiation process so that the pacts can be signed as planned.

Thuc was recently on a four-day visit to Russia, PetroVietnam said in a statement.

Current stakeholders in the 15-1/05 block, which is in the exploration stage, are PetroVietnam Exploration and Production (40%, block operator), Total E&P Vietnam (35%) and South Korea’s SK Energy (25%), according to Total and SK Energy.

The two foreign stakeholders announced its second oil discovery in the Lac Da Vang prospect in September 2010 following the first find in November 2009.

Vietnam currently imports crude oil for its sole 130,000 b/d refinery at Dung Quat, which is mainly fed by domestic crude oil. During January-September, the country imported 947,010 mt of crude oil for the refinery, up 67.6% from the same period last year. Most of the imported crude oil came from Brunei and Malaysia, according to Vietnam Customs data.