New Delhi:Ruias-led Essar Exploration & Production Ltd (EEPL) and partner Italy’s Eni plan to start production from their offshore block in Vietnam in 2024-25, a top Essar executive said.Discovered in 2019, Block 114 is the largest hydrocarbon find in South East Asia in two decades and is estimated to hold about 2 billion barrels of oil and gas resource, according to Essar. Eni is the operator with 50% participating interest in the block. EEPL holds the balance stake.
The partners have already drilled three wells in the block and plan to drill one more appraisal well in 2022. A field development plan will be prepared, latest by mid-2023, based on the data from the appraisal wells, Pankaj Kalra, CEO, EEPL, Mauritius, told ET. Once the field development plan is approved, the big task of drilling development wells and setting up processing platforms will begin.
“We will go for early monetization by putting up modular facilities. The production should start by 2024-25,” said Kalra. Early monetization means explorers can start commercial production from discoveries made early in the contract period without waiting for the approval of the development plan for the entire field.Essar didn’t share production or investment estimates as these are yet to be approved by the Vietnamese regulator. Block 114, which is in the shallow waters of the Song Hong basin in Vietnam, has already received an investment of more than $300 million, as per Essar.
“We are confident that this block will provide strong impetus for Vietnam to become self-sufficient in its energy requirements in the future,’’ Prashant Ruia, director, Essar Capital, said in a statement. Essar Capital is the investment arm of the Essar group.
Prashant Ruia and Essar group founder Ravi Ruia recently met with Vuong Dinh Hue, chairman of the national assembly of Vietnam, and Le Manh Hung, the deputy prime minister of the country, to discuss the investments of Essar group and potential collaboration and business opportunities in Vietnam, as per the company statement. Le Manh Hung is also the CEO of Petrovietnam.
Essar and Eni are exploring more hydrocarbons in the Dan Day basin and other prospects in Vietnam. Essar is also scouting for opportunities in the petrochemical space in Vietnam, Kalra said.