More Foreign Oil Firms Report They Are Near Drilling Deals

France’s Total and China’s state-run Chinese National Offshore Oil Corp are close to signing deals for onshore oil exploration, government and company officials said.

Patrick Pouyanne, senior vice president for strategy at Total, said by phone from Paris that the company has “good hope to conclude an agreement in the coming months” for “a large license on­shore in Cambodia.” He declined to say where.

“We are in discussions with the National Authority of Cambodia to see if we can develop exploration activity. It’s frontier exploration. Onshore Cambodia has not been explored until now,” he said.

Total has been negotiating with the Cambodian National Petrol­eum Authority since early 2007, Pouyanne said.

Deputy Prime Minister Sok An told a UN Development Program oil conference in March that negotiations were under way for onshore exploration deals with companies including Total, Moeco, Jogmec, GS Caltex, Pan Orient and INPEX.

According to a high-ranking CNPA official, who spoke on condition of anonymity, CNOOC is interested in block 13, which lies just to the north of the Tonle Sap lake.

“It is really environmentally sensitive. The government moves cautiously,” he said. “After the election they might sign an agreement.”

Last year, CNOOC inked an exploration agreement for Cam­bodia’s offshore Block F and has already finished preliminary seismic work there, the official said.

The government has contracted with Petroleum Geo-Services, a Norwegian geophysical data collection and analysis firm, to conduct seismic studies of its onshore oil basins, he added. Seismic studies are an early step in determining the scope of potential oil reserves.

Contract talks on a revenue-sharing agreement with US oil giant Chevron, which struck oil in offshore Block A in 2005, are on-going, the CNPA official added.

“Until we get clear guidance from the Ministry of Finance, the Supreme National Economic Coun­cil], [Council for the Develop­ment of Cambodia]—after that, the Prime Minister will make a final decision,” he said.

Most of onshore Block 13 lies in Banteay Meanchey province.

Sok Saret, a deputy governor of Banteay Meanchey province, said Monday he didn’t know about an exploration contract with CNOOC.

Preach Sun, a secretary of state in the Ministry of Environment, said Monday he did not know about the pending deal with CNOOC and had not seen documents related to the matter. But, he added, he is wary of the potential impacts on Cambodia’s great lake. “When they do exploration or mining, it affects the environment,” he said.

The Tonle Sap floodplain is home to about 10 percent of Cambodia’s population and provides 75 percent of the animal protein consumed in the country, according to the Asian Develop­ment Bank.

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