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Singapore's firm signs deal with Cambodia for first-ever oil extraction

Staff Writer |
Singapore-based oil and gas company KrisEnergy signed a long-awaited production- sharing agreement with the Cambodian government on Wednesday for the first-ever extraction of petroleum from Block A in Cambodian territorial waters.

The deal was inked here between KrisEnergy's chief operating officer Kelvin Tang and Cambodian Industry, Mines and Energy Minister Suy Sem and Economy and Finance Minister Aun Pornmoniroth.

KrisEnergy holds a 95 percent stake in the 3,083-sq-km offshore block, and the Cambodian government owns the remaining 5 percent.

Kelvin Tang said the agreement was a significant milestone for Cambodia in its long journey to become an oil-producing nation. "This is a major step. It is Cambodia's first oil field," he said after the signing ceremony.

"Shortly after the signing, we will declare final investment decision and proceed to deliver 1st oil in 24 month - sometime in 2019," he said, denying to disclose the investment cost for the project.

Suy Sem said the agreement was the crucial commencement towards first crude oil production from offshore Cambodia.

"It is estimated that Phase 1A and Phase 1B (of the stage one of Block A) will provide more than 30 million barrels over the period of nine years, and it is sufficient commercially to make Cambodia become an oil producing country in the future," he said.

"The development of Block A is also a catalyst to more intense exploration works in another five offshore and 18 onshore blocks," he said.

The minister said the oil business would be a major new impetus for social advancement, human resource development, building Cambodia's competitive capacity, and growth of domestic production and service chains.

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