Vietnam risks becoming energy importer

Crude oil prices 128 November 2013, News Wires – Vietnam is at risk of changing from a net exporter to a net importer within years if the country’s growing energy demands are not met.

Speaking at the Asean Council on Petroleum (Ascope) conference in Ho Cho Minh City on Thursday, Vietnam’s Deputy Prime Minister Hoang Trung Hai told delegates that Vietnam faced becoming a net importer of energy by 2017, despite the country’s energy needs only being about one tenth of those in developed countries.

“The question is how do we overcome these challenges and problems? We don’t think that Vietnam can have individual solutions for these sorts of problems,” he said.

“We have to work with our regional and international partners and companies to exploit all of the best technologies and management solutions to face these challenges and have competent sustainable development in the future.”

He said the government had always been “attentive and created favourable conditions” for the petroleum sector in the country to allow it to develop and serve as “the locomotive of the economy”, while contributing to Vietnam’s energy security.

He added that the country’s oil and gas sector helped contribute to the South East Asia region and highlighted the importance of events like Ascope in helping assist those countires in the region to work together.

“I think this Ascope forum is very important for companies in the region and the world to cooperate to seek new know how new technologies to employ better exploration and production for future developments and for sustainable developments,” Hai said.

Vietnam’s energy shortage is likely to be exacerbated in the future with Hai noting that the country’s population was set to increase from about 90 million currently to 130 million by 2030.

Hai’s concerns were backed by Petrovietnam chief Do Van Hau who also told delegates that new discoveries were not offsetting the company’s current fall in oil production.

He noted that Vietnam’s current recoverable reserves stood at about 10 billion barrels of oil equivalent, split about 50:50 between oil and gas.

Hau added that about 40% of the recoverable oil reserves had already been produced while only about 25% of the recoverable gas reserves have been produced.

“For the last few years, every year we add to the recoverable reserves somewhere from 200 million to 230 million and up to 280 million boe,” Hau said.

“The replacement ratio for us is a bit low.”

According to Hau, Petrovietnam’s current domestic oil output averages about 310,000 barrels per day, however when taking in to account its international production that figure increases up to about 340,000 bpd. The company’s gas production is currently averaging about 1 billion cubic feet per day.

Despite the state-run company making about five commercial discoveries, on average, per year Hau said output from new fields being brought in to production was not enough to offset the decline of the production from its major oilfields in Vietnam.

“In total production of the oil in Vietnam is still declining but we are trying to maintain production at a stable rate as much as possible,” he said.

– Upstream

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