OREANDA-NEWS  On 01 October was announced, that on the 8th of September, 2008 the 3rd Meeting of the Russian-Vietnamese Intergovernmental Subcommittee was held regarding consideration of the issues connected with reorganization of “Vietsovpetro” JV after the year 2010. The Russian Party was represented by the Deputy Minister of Industry and Trade, V.Y. Salamatov (the head of delegation), Deputy Minister of Energy, S.Y. Svetlitsky, Ambassador Extraordinary and Plenipotentiary of the Russian Federation in SRV, V.V. Serafimov, Deputy Head of the Department of the Ministry of Industry and Trade, V.V. Oseledko, General Director of “Zarubezhneft” JSC, N.G. Brunich, Member of the Board of Directors of “Zarubezhneft”, D.A. Titov, Deputies General Director, A.L. Garybyan, N.A. Makarov, the specialists of the company. From the Vietnamese Party Deputy Minister of the Industry and Trade, Do Huu Hao, Deputy General Director of the National Oil and Gas Group “Petrovietnam” Nguyen Tien Dung, the representatives of “Vietsovpetro” JV and other structures took part in the meeting.

During the exchange of greetings the heads of the Parties noted that for the years of cooperation “Petrovietnam” and “Zarubezhneft” have achieved a serious success as the result of which “Vietsovpetro” JV holds the leading positions among oil-producing companies of the Asia-Pacific Region. It gives all grounds for continuation of the further cooperation of the Russian and Vietnamese partners by reorganization of “Vietsovpetro” JV after the year 2010 into a limited liability company. Therefore, the task of the Subcommittee is to examine and prepare for signing the draft Intergovernmental Agreement of “Vietsovpetro” reorganization.

In discussing the subject of continuation of cooperation between “Petrovietnam” and “Zarubezhneft”, Mr. V.Y. Salamatov and Mr. Do Huu Hao, have particularly underlined the fact that in the territory of Russia “JC “Rusvietpetro” Ltd. was registered, in which both companies will also be the partners.

Further, the participants of the meeting were shortly informed about the activities of “Vietsovpetro” JV starting from the date of its establishment to present day and about the plans up to the year 2010. In particular, it was said that from the oil production commencement date (June 1986) 174 million tons of oil were recovered. The profit of the Vietnamese Party from commercial oil sale was 27,2 billion USD, and that of the Russian Party – 7,3 billion USD. For the current year the estimated production rate will be 7,65 million tons of oil. For the period from 2008 to 2010 it is planned to produce from White Tiger and Dragon fields 18,5-18,8 million tons.

In the course of exchange of opinions Deputy General Director of the National Oil and Gas Group “Petrovietnam” Nguyen Tien Dung has noted that reorganization of “Vietsovpetro” JV is of a high importance. It enables to carry out oil exploration, production works in Blocks 09-1 and 04-3, to render services both in the territory of Vietnam and in the other countries.

Having considered and discussed the proposals of the participants of “Vietsovpetro” on conditions, content, form, schedule and other matters connected with reorganization of “Vietsovpetro” JV after the year 2010, the parties have come to the following:

- from the First of January, 2011 “Vietsovpetro” JV shall be reorganized into limited liability company “Vietsovpetro” with two participants – JSC “Zarubezhneft” and National Oil and Gas Group “Petrovietnam” with a share participation in the Authorized Capital of 49% and 51%, respectively;

- limited liability company “Vietsovpetro” with two participants from the First of January, 2011 will continue oil and gas activities on the Block 09-1 of the shelf of the south of Vietnam (White Tiger and Dragon field) and Block 04-3 on the basis of oil and gas contract in accordance with the legislation of Vietnam.

Summarizing the results of the meeting the Minutes of the Meeting of the Russian-Vietnamese Intergovernmental Subcommittee was signed. The Parties also have come to conclusion about the necessity to sign the Intergovernmental Agreement where the main positions of “Vietsovpetro” JV after the year 2010 would be determined. Its draft was agreed which will be submitted for consideration of the two countries.

It is planned to sign an Intergovernmental Agreement during the visit of the President of SRV, Nguyen Minh Triet to Russia in the end of October.

Giving a speech during the meeting, General Director of “Zarubezhneft” JSC, N.G. Brunich has underlined the importance of the passing meeting, marked a considerable previous preparation work and expressed his assurance in further, even more fruitful cooperation between “Petrovietnam” and “Zarubezhneft”. Its new stage was outlined after “Zarubezhneft” JSC won in tender for the right of development of the four blocks of the Central-Khoreiverskoye Uplift (CKU) in Nenets Autonomous Area. It was proposed to “Petrovietnam” to act as a partner. In July “JC “Rusvietpetro” Ltd. was established for development of the new areas. Recently it received the licenses for the right to develop CKU.

The Vietnamese colleagues are informed about all conditions of “Petrovietnam” entering into “Rusvietpetro”. In the end of October it is planned to sign an Agreement for purchase by it of the share amounting to 49 %.

Proven oil reserves in the blocks of CKU amount to 100 million tons of oil, the first production is planned to commence in 2011.But preliminary it is necessary to establish a required infrastructure, and today these works have started. Prior to the end of the year it is planned to spend about 200 million USD. The experience of the Russian-Vietnamese partners in the new areas can be fully used in the third.