Singapore — Thai oil and gas giant PTT Exploration and Production (PTTEP) has acquired 50% of Block A-18 in the Malaysia–Thailand Joint Development Area (MTJDA) in a $450 million transaction with Chevron units.
PTTEP said in a statement late on Friday it signed the deal with Hess (Bahamas) and Hess Asia Holdings, both now owned by Chevron following a recent merger with Hess Corp.
The acquisition gives PTTEP 100% of the outstanding shares in Hess International Oil Corp, which holds a 50% participating interest in Block A-18, PTTEP said.
The deal comes as Chevron restructures globally to streamline operations and reduce costs, a process that could see it lay off up to 20% of its workforce by the end of next year. Chevron is also seeking buyers for its 50% stake in its Singapore refinery, Reuters reported in June.
PTTEP said natural gas from Block A-18 is fundamental to power generation for southern Thailand. The block produces about 600 million standard cubic feet of gas per day, which is equally distributed to Thailand and Malaysia.
“PTTEP is pleased to further expand our operations in the MTJDA, which is recognized for its petroleum potential and strategic significance to Thailand’s energy security,” Chief Executive Officer Montri Rawanchaikul said in the statement.
The MTJDA covers 7,250 sq km (2,800 sq miles) in the southern part of the Gulf of Thailand and is a key source of natural gas and condensate for Thailand and Malaysia, according to the statement.
Reporting by Yantoultra Ngui; Editing by Tom Hogue – Reuters
