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JOGMEC Provides Equity Financing to Idemitsu and Sumitomo’s Exploration Project offshore Vietnam
JOGMEC Provides Equity Financing to Idemitsu and Sumitomo’s Exploration Project offshore Vietnam
PDF version of this page (305 KB)August 12, 2015
JOGMEC (President: Hirobumi Kawano) announced today that it will provide equity financing to Special Purpose Companies, will be established by Idemitsu Kosan Co., Ltd. (“Idemitsu”) and Sumitomo Corporation (“Sumitomo”) respectively, which acquired participating interests in the exploration Blocks 39 and 40/02 offshore, Vietnam.
Idemitsu and Sumitomo signed the Production Sharing Contract (“PSC”), with Vietnam Oil and Gas Group (“PETROVIETNAM”), a state enterprise of Vietnam, for offshore South West Vietnam Blocks 39 and 40/02 on August 11, 2015. JOGMEC will provide equity capital up to 50% covering the exploration expenditures incurred by the subsidiaries of Idemitsu and Sumitomo for the project.
Within the framework of JOGMEC’s Cooperative Overseas Surveys and Studies Program (“Cooperative Program”), under the Joint Study Agreement between JOGMEC and PETROVIETNAM, Idemitsu and JOGMEC carried out recording of 2D seismic data and geochemical studies in offshore southwest Vietnam from October 2011 to August 2013. As a result, Idemitsu exercised the exclusive right to negotiate with PETROVIETNAM regarding the PSC with receiving Sumitomo as a partner. Finally, both Japanese companies and PETROVIETNAM concluded the PSC.
It is a significant achievement and outcome of JOGMEC activities that the Cooperative Program has immediately contributed to the acquisition of exploration acreage, where, furthermore, JOGMEC continues to be involved through its equity financing.
Through the support of JOGMEC, it is expected to enhance upstream activities for Idemitsu and Sumitomo in Vietnam as well as reinforce Japan’s energy security when successful.
Within the framework of JOGMEC’s Cooperative Overseas Surveys and Studies Program (“Cooperative Program”), under the Joint Study Agreement between JOGMEC and PETROVIETNAM, Idemitsu and JOGMEC carried out recording of 2D seismic data and geochemical studies in offshore southwest Vietnam from October 2011 to August 2013. As a result, Idemitsu exercised the exclusive right to negotiate with PETROVIETNAM regarding the PSC with receiving Sumitomo as a partner. Finally, both Japanese companies and PETROVIETNAM concluded the PSC.
It is a significant achievement and outcome of JOGMEC activities that the Cooperative Program has immediately contributed to the acquisition of exploration acreage, where, furthermore, JOGMEC continues to be involved through its equity financing.
Through the support of JOGMEC, it is expected to enhance upstream activities for Idemitsu and Sumitomo in Vietnam as well as reinforce Japan’s energy security when successful.
Background Information
| Corporate Data | Idemitsu Vietnam South West Oil Exploration Co., Ltd. (P) |
| Shareholders after JOGMEC’s funding | Idemitsu (Voting rights more than 50%) JOGMEC (Voting rights less than 50%) |
| Corporate Data | Summit E & P Vietnam Corporation (P) |
| Shareholders after JOGMEC’s funding | Sumitomo (Voting rights more than 50%) JOGMEC (Voting rights less than 50%) |
Contract Area Details
| Name | Blocks 39 and 40/02 offshore South West Vietnam |
| Area of Blocks | Approximately 11,620km² |
| Water Depth | 50m to 60m |
Participating Interest
| Idemitsu Kosan Co., Ltd.* | 75% |
| Sumitomo Corporation | 25% |
* Operator
Idemitsu and Sumitomo will establish SPCs and give their interests SPCs respectively.
Idemitsu and Sumitomo will establish SPCs and give their interests SPCs respectively.
JOGMEC Assistance
| Date of Approval | August 4, 2015 |
| Estimated Amount of Equity Financing (Idemitsu and Sumitomo) | approximately JPY 5.7Billion |
Note
Approval has been made in accordance with JOGMEC’s technical, economic, and business-environment criteria and the consent from the Minister of Economy, Trade and Industry has been obtained.
Location of Contract Area
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