Cambodia has signed an oil production agreement with Singapore-based KrisEnergy Group, paving the way for the long-awaited development of the country’s Block A oil field.
The signing came three years after KrisEnergy bought up the Chevron company’s shares in the field.
Kalvin Tang, COE of KrisEnergy, said the company would deploy equipment and technical staff to develop the oil field within two years.
“Shortly after signing, we will declare [a] final investment decision and proceed to deliver [the] first oil in Cambodia within 24 months, so that will be sometime in late 2019. This is a major step,” he said.
He added that KrisEnergy had pledged to operate with transparency. “When there are changes to our businesses, our condition, or shareholders, we will report [them] immediately.”
Tang told reporters that the company could not provide details about capital investment as it was continuing to seek further investors through an open bidding process.
KrisEnergy also offered to assist the government in drawing up anti-corruption safeguards for the oil industry.
Chevron decided to pull out of Cambodia after 12 years of prospecting, selling its 30 percent stake in the oil field to KrisEnergy in 2014 for $65 million. The other stakeholders are Moeco Cambodia and GS Energy Corporation.
Suy Sem, mines and energy minister, said there were an estimated 30 million barrels of oil in Block A and Block B, adding that the signing of the agreement with KrisEnergy was a “fabulous achievement” that would bolster Cambodia’s economy.
Kim Natacha, a Cambodian extractive industries expert, said the advent of oil production in Cambodia would create jobs and increase trade, adding that the government should create a forum of civil society groups that could monitor the industry to ensure transparency.
“Some civil society groups have taken part in this mechanism, which is called Extractive Industry Governance Forum (EIGF), and this forum will be open to the participation of civil society organizations that registered,” she said.