Jadestone Nears Vietnam Gas Sale

Southeast Asia focused Jadestone Energy is nearer a gas sales agreement with state PetroVietnam, having signed two heads of agreement (HOA) relating to its resources in the Nam Du and U Minh gas fields, it said April 29. Jadestone is operator with 70% in 46/07 and block 51, respectively, offshore southwest Vietnam.  

The HOA cover all discovered resources from the Nam Du and U Minh fields and establishes a mutually agreeable framework for gas sales of 80mn ft³/day for a minimum plateau of 55 months, priced at the wellhead, and delivered to a tie-in point at a nearby existing pipeline, it said. 

The HOA includes take or pay provisions and a pricing formula in principle, all of which will be finalised in the ultimate gas sales and purchase agreement, which the parties hope to reach later this year. 

The spirit of the HOA captures a negotiated price outcome that will be competitive, while providing Jadestone with an appropriate full cycle investment return. 

 CEO Paul Blakeley said the HOA is a "significant milestone" in its commercial negotiations. "With key terms now broadly agreed, we can now press forward with the project activities that should lead to a development decision being taken later this year," he said.

The assets will help the company toward its goal of 30,000 barrels of oil equivalent by 2023, as well as significant cash flow and value, with first gas anticipated in late 2021, it said.

The Nam Du and U Minh fields contain gross 2C resources of 171.3bn ft³ and 1.6mn barrels of liquids. Jadestone plans to commercialise the fields as a stand-alone development, using existing infrastructure which provides feedstock for a 1.5-GW onshore power complex, and an adjacent 800,000 metric tons/year fertiliser plant.