Oil & Gas SectorVietnam ChapterPham Quynh Mai, Market Advisor (Oil & Gas)mapha@innovationnorway.noSeptember 2010

Vietnam Country Data• Size: 329,560 sq km

• Economic zone: 1,000,000 sq. km

• Coastline: 3,260 km (ex. the islands)

• Population: 86.2 million (2009e) (60 -65% born after 1975)

• Capital: Hanoi

• Oil Capital: Vung Tau

• Member of ASEAN, AFTA, ASEM, APEC and WTO

• Trade cooperation with 180 countries

• Trade agreements with 80 countries

• Key exported earners: Textile, Footware, Crude Oil , Seafood

• Stable political conditionsPhoto credits

Vietnam Oil & Gas Industry… an overview

Vietnam Oil and Gas PotentialsVietnam- 3rd largest oil producer in SEA

• 8 identified sedimentary basins

• Potential oil resources: 8.5 bn bbls

• Potential gas resources: 100 TCF

• Proven Oil reserves (2009): 4.5 bbls

• Proven Gas reserves (2009): 24.1 TCF

• PetroVietnam: dominant oil & gas producer

Photo credits Source: PetroVietnam

Annual Oil & Gas Production

Source: PetroVietnam

$4.5 bn p.aInvestments

in E&P (*)

540 - 635380 - 440160 - 195Total

150 - 165110 - 12040 - 45International

390 - 470270 -320120 – 150Domestic

Total2016 - 20202011 - 2015New reserves

(mm toe)

Strategic Development Targets

40 - 4830 - 46Total

10 -153 - 7International

30 - 3327 - 39Domestic

2016 - 20202011 - 2015Annual Production

(mm toe)

Source: PetroVietnam;(*): BMI Q110

Oil & Gas Production Forecasts

Source: PetroVietnam

Upstream Sector

Regional Upstream Business Environment Rating

Source: BMI Q110

6o N

8o N

10o N

12o N

14o N

102o E 104o E 106o E 108o E 112o E110o E

22o N

16o N

18o N

20o N

102o E 104o E 106o E 108o E 110o E 112o E 114o E 116o E

114o E 116o E

14o N

6o N

8o N

10o N

12o N

16o N

18o N

20o N

22o N

HuÕ

Vinh

h µ n é iH¶i phßng

R¹ch gi¸

Thanh hãa

§ . B¹ch long vÜ

LAOS

§ . Cån cá

§ . Phó quÝ

§ . Phó quèc

§ . Thæ chu

CAMBODIA

THAILAND

Cµ mau

§ µ n½ng

Qui nh¬n

Nha trang

Phan thiÕtTp. Hå ChÝ Minh

Vòng tµuCÇn th¬

(China)

Q. § . Hoµng sa

Q. § . Tr- êng sa

C«n ®¶o

Hainan is.

CHINA

§ . Lý s¬n

§ . Hoµng sa§ . Ling c«n

52/97

47/01

48/05B/05

50

PM3 CAA

46-CN

46/07

VTM area 46/02

51

4331

4142

44

45

§ BSCL-03

§ BSCL-04

37 32

33

34

38

39

40/02 29/0335

36/03

MVHN-02KT

102

103

MVHN-02

MVHNMVHN-03KT

MVHN-01KT

104-109/05

105-110/04

111/04

112

114

VBB2005

108/04

17

09-1

16-116-1/03

16-2

25§ BSCL-01

28

18

19

20

26

27

15-1-ST01-HN

01/97

02/9715-1/05

15-2-RD15-2/01

§ BSCL-02

106/07

100-101/04

107/04

106

12/07

13/03

12

12/07

12/0721

22/03

10

11-1

11-211-2/97

0309-2

09-2/03

09-3

09-3/0504-104-2

04-305-1-DH05-1/04

118

113

115

116 117 141

142

06/94

05-205-3-105-3/97

06-1

07/03

134-2

135

136/03

128

124

125

126

127

119

120

121

143

144

147123

122

145

146

148

133

129

130

131

132

134-1 158

154

155

156

157

159

160

152

149

150

151

153

V-T-P 2005

Cuu Long Basin

09-1 VSP

16-2 PVEP§ BSCL-01 Salamander

15-1/05 Phu quy JOC15-2 (RD) JVPC

15-2/01 Thang long JOC16-1 Hoang long JOC

Bacbo Gulf-2005

PETROVIETNAM - March, 2008

15-1 (ST) Cuu long JOC

01 (HN) PCOSB01/97 & 02/97 Lam son JOC

09-2 Hoan vu JOC09-3 VRJ JOC

Nam Con Son Basin

07/03 Premier Oil

04-3 VSP05-1 (DH) PVEP

05-1b&05-1c Idemitsu05-2, 05-3, 06-1 BP06/94 Pearl Energy

10 & 11-1 Con son JOC

133, 134-1 ConocoPhillips

11-2-1 KNOC12 Premier Oil28, 29/03 Mitra Energy

Vietnam-Philippine-China 2005Blocks awarded, but contracts not signed yet

Song Hong Basin

Malay-Tho Chu Basin

Phu Khanh Basin

46 (CN) Talisman Vietnam

102, 106 PCL (V)

PM3 CAA TalismanB/05, 52/97 Chevron Vietnam

46/02 Truong son JOC

122 Chevron Vietnam124 Pogo Producing127&128 ONGC Videsh

MVHN-02 Quad Energy

100-101/04 Santos

103, 107/04 Bach dang104, 109/05 Premier Oil111/04, 112, 113 VietGazProm

Vietnam Domestic E&P map

Source: PetroVietnam

MAJOR PRODUCTIONS:• OIL FROM CUULONG BASIN• GAS FROM NAM CON SON BASINOFFSHORE, WATER DEPTH: 30M – 150M

MAJOR PRODUCTIONS:• OIL FROM CUULONG BASIN• GAS FROM NAM CON SON BASINOFFSHORE, WATER DEPTH: 30M – 150M

DiscoveredYet-found Potentials

Source: PetroVietnam

E&P Activities

Newly acquired multi-client seismic surveysCurrent Status of seismic surveys (Apr 2010)

BY 2015, PTSC TARGETS:• OWN 10 ROVs• 3-5 2D/3D SEISMIC ACQUISITION VESSELS• DOMINATES 90% OF DOMESTIC MARKET

BY 2015, PTSC TARGETS:• OWN 10 ROVs• 3-5 2D/3D SEISMIC ACQUISITION VESSELS• DOMINATES 90% OF DOMESTIC MARKET

• 400.000 km 2D• 60.000 km2 3D• > 990 wells• >2.3 mill meters drilling depth

Seismic Activities

Source: PetroVietnam

Source: PetroVietnamUpdated Dec 2009

Open Opportunities

Drilling Achievements

• Longest Well (HVJOC): 6,555mMD @4,609mTVD

• Deepest Well (VSP): 5,050mMD @5,009m TVDss(VSP)

• Longest Displacement (CLJOC): 4,842.8m (6,350mMD @3,057mTVD)

• Longest Basement Interval (CLJOC): 2,715m

• Deepest Water Depth (BG): 821m.

Source: VPI

Drilling Technologies Being Used• Geo – Steering

• MWD/LWD, MWD/GYRO

• Extended Reach Drilling

• Light Cement Slurries

• Bit Optimization

• New Mud Systems

• Splitter Wellhead

• Casing Drilling

• Mud Cap Drilling

• Managed Pressure Drilling

• Slim Hole Drilling

• Expandable Casing

• Rotary Steerable System Source: VPI

• Vietnam market requires 10-11 jack-up rigs p.a

• 900 wells to be explored by 2025, whereas 50 wells to be explored between 2011-2015 each year in average

• PVD, VN-Index listed company with 50.38% ownerhip by PetroVietnam,

Source: ODS Petro Data & PVD

PVD EXPECT TO INCREASE ITS MARKET SHARE TO 50% BY INVESTING 5-7 RIGS IN NEXT 3 YEARS

PVD EXPECT TO INCREASE ITS MARKET SHARE TO 50% BY INVESTING 5-7 RIGS IN NEXT 3 YEARS

Future Drilling Activities

accounts 30% drilling market share with 3 jack up rigs

Source: PVD

Invest

men

t sc

hed

ule

PVD Investments

Upstream Challenges• Major oil fields, like Bach Ho, have reached to their maturity

and lower production has experienced

• High pressure high temperature drilling in the main Nam Con Son basin

• Unrecovered petroleum resources are spreading mainly in high water depth zones and far from logistic bases

• New recoveries: Marginal fields, gas with high CO2 content, especially in the north basins (70-90%)

• Oil and Gas production in complex reservoir structures (75% in the fractured granite basement reservoirs)

• Lack of experiences in deepwater E&P. Financial constrains

• Territories conflicts in some potential oil areas

Midstream Sector

Gas Transportation System

CAMBODIA

Ca Mau Complex

Vietnam –Malaysia CAA

O Mon

HiepPhuoc

Dinh Co GPPPhu My Complex

Cuu Long Basin

Nam Con Son Basin

Ma Lay ThoChu Basin

Bach Ho –Phu My PL:•Capacity: 2 bcmpa•Length: 117 km•Diameter: 16”

Nam Con Son PL:•Capacity: 7 bcmpa•Length: 400 km•Diameter: 26”

PM3-Ca Mau PL:•Capacity: 2 bcmpa•Length: 330 km•Diameter: 18”

Block B – O Mon PL:•Operation in 2014•Capacity: 7 bcmy•Length: 400 km•Diameter: 28-30”

Southeast-Southwest PL:•Capacity: 2 bcmpa•Oeration in ~ 2014

Nam Con Son 2 PL:•Capacity: 7 bcmpa•Length: 330 km•Operation in ~ 2013

Source: PVGas

Gas Transportation System

No activities within LNG to date, but new investments are coming up

Possible Gas Structure in Vietnam• Import LNG by 2012 and PNG by 2018

for domestic market• Get accessed to new markets in South

East Asia after 2018(by PVGas)

Other Investment Plans• Build a mini LNG terminal to supply fuel to a Power plan

project in Phu Quoc Island (<200MW) in 2 phases: • Phase 1: upto 2015 with capacity 150,000 tpa LNG• Phase 2: after 2015 increase to 300,000 tpa LNG

• Build/acquire 2 LNG re-gasification terminals in South East of Vietnam:

• Lease 1st floating LNG FSRU (0.5-1 mmtpa): 2012

• Build 1st land-based LNG re-gasification terminal:

• Phase 1: 1 mmtpa in operation in 2015

• Phase 2: 3 mmtpa in operation in 2020

• Phase 3: 6 mmtpa in operation in 2025

• Implement Marginal Gas Gathering Projects in Cuu Long, Nam Con Son, Malay-Tho Chu and Song Hong Basins

• Thi Vai refregirated LPG terminal (60 ktns): 2009-2012

Downstream Sector

Current Supplies of Petroleum Products

Source: PVPro

Current Supplies of Petrochemicals

Source: PVPro

PetroVietnam Projects

1. Dzung Quat refinery($3.1 bn, 6.5 mntpa): Feb09

2. Nghi Son refinery($8 bn, 8.4 mntpa): 2010–2013

3. Long Son refinery($8 bn, 10 mntpa): 2010–2015

4. South Vietnam Petrochemical complex ($3.8bn): 2014

5. Ca Mau fertilizer plan ($900mn): 2008 -2012

6. Others: Polypropylene Project, Polyester Stable Fiber Project, etc.

Source: PVPro

Other projects

• Petrolimex refinery ($4.4-4.5 bn,10 mntpa): 2014• Vung Ro Refinery ($1.7 bn, 8 mntpa)• Can Tho Refinery ($538 mn, 2mntpa): 2012

Opportunities &Ways to materialize

Opportunities to Norwegian Co.

Photo credits: Unknown

• Increased Oil Recovery

• Deep water drilling, and sub sea technology

• LNG whole value chain

• Distribution and utilisation of gas ashore, both for industrialand consumer usage

• Establishment of local production of supporting devices

31

Ways to materialize opportunities

Why IN HanoiOur position:• Local present in the market with a dedicated team with focus

within Oil & Gas, Maritime, Marine and Energy and Environment who understand the business culture and practices

• Strong network within Oil & Gas community• Strong position in the market, commercially and politically

Our activities within Oil & Gas in 2010:• Identifying market needs within IOR/EOR (to be available Dec

2010)• Closedly involved in the LNG value chain project with

PetroVietnam.

Vision

We give localideas global

Opportunities