OPPORTUNITIES FOR DEVELOPMENT OF NATURAL

GAS IN VIETNAM

Presented by Nguyen Dang LieuVice PresidentPetroVietnam

Qatar – 2006

VIETNAM OIL AND GAS CORPORATION

ContentContent

OPPORTUNITIES FOR DEVELOPMENT OF OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM NATURAL GAS IN VIETNAM

Vietnam Vietnam –– Country OverviewCountry OverviewExploration Activities Exploration Activities Gas Industry in VietnamGas Industry in VietnamContactsContacts

VietnamVietnam –– General InformationGeneral Information

Official Name Socialist Republic of VietnamCapital HanoiArea 329,560 sq. kmClimate Tropical MonsoonPopulation 82 million (2004)Currency Dong (VND); 1USD~16,000

VNDOfficial Languages VietnameseGDP Growth Rate 8.4% (2005)Major Export Products

crude oil, rice, marine products, garments, coffee, coal, rubber, nuts

Major Import Products

petroleum products, tractors, tires, steel products, foodstuff, cotton

0

2

4

6

8

10

12

1988 1990 1992 1994 1996 1998 2000 2002 2004

Năm

Sô

hôp đô

ng

Foreign investments: - 50 petroleum contracts

(PSC, JOC, BCC)- 27 contracts still valid- More than 7 billion USD

investment

Number of signed contracts/year Valid contracts

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM EXPLORATION ACTIVITIESEXPLORATION ACTIVITIES

Exploration activities started in the early 1960s.From 1988-2004:• Seismic:

- 2D - more than 300,000 Km- 3D ~ 40,000 Km2

• More than 600 exploratory and production wells drilled

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM EXPLORATION ACTIVITIESEXPLORATION ACTIVITIES

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM EXPLORATION ACTIVITIESEXPLORATION ACTIVITIES

• 8 high potential hydrocarbon basinsdefined : Song Hong, Phu Khanh, Cuu Long, Nam Con Son, Tu Chinh-Vung May, Malay-Tho Chu and Truong Sa-Hoang Sa Basins.

• Major exploration targets- Fractured basement plays- Oligocene-Miocene clastic plays- Miocene carbonate plays

• Total potentials: 20,400 MMbbls OE• More than 70 discoveries found• Total oil and gas reserves: 5,700 MMbbls OE 0.1/4700

0/3150

0/5950

4.7/41002.8/1150

5.5/950

Total resourcesTotal resources in Vietnam Tertiary basins up to in Vietnam Tertiary basins up to 112/20052/2005

Gas reserves (TCF) / Potential (MMbbls)Gas reserves (TCF) / Potential (MMbbls)

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM EXPLORATION ACTIVITIESEXPLORATION ACTIVITIES

3150

15504100

950

59504700

Song hong PhukhanhCuulong NamconsonMalay-Thochu Tuchinh-Vung May

• Total potentials: 20,400 MMbbls OE• More than 70 discoveries found• Total oil and gas reserves: 5,700 MMbbls OE

• Gas reserves: more than 13TCF0.1/4700

0/3150

0/5950

4.7/41002.8/1150

5.5/950

Total resourcesTotal resources in Vietnam Tertiary basins up to in Vietnam Tertiary basins up to 112/20052/2005

Gas reserves (TCF) / Potential (MMbbls)Gas reserves (TCF) / Potential (MMbbls)

GIIP Gas Reserve

TCF % TCF %

Song Hong 12.7 32.2% 0.1 0.7%

Cuu long 8.3 20.9% 2.8 21.7%

Nam Con Son 9.6 24.3% 4.7 35.7%

Malay-Tho chu 8.9 22.6% 5.5 41.8%

Total 39.4 100.0% 13.1 100.0%

Basin

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM EXPLORATION ACTIVITIESEXPLORATION ACTIVITIES

• Gas produced from fields: Bach Ho, Rong, Rang Dong (Cuulong), Lan Tay (Nam Con Son), Bunga Kekwa - Cai Nuoc, Bunga Raya and Bunga Seroja (Malay)

• Current average gas production rate: 630 MMSCFD (17.8 MMSCMD)

• To the year 2010, the gas production of 650-1000 MMSCFD will be maintained

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas Industry: Gas Industry: Production HighlightsProduction Highlights

Year 1997 1998 1999 2000 2001 2002 2003 2004 2005

Production (BCF) 40 74 100 110 122 156 218 270 280

Oil and gas production 1989-2004 and prediction to 2010

4 2 3 2 2 4

18 24

40

74

100 11

0 122

156

218

270 28

0 300 32

0 340 35

0 370

8.5 10 15 20 25 28.5

30 31.5 36 45 54 56 67 75 81 89 95 10

2 110 11

8

121 12

7

0

50

100

150

200

250

300

350

400

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Year

Oil

(mm

bbls

) / G

as (B

CF) Gas BCF

Oil MMbbls

Increase gas production output from 280 BCF in the year 2005 to 400-:-450

BCF in 2010, 500-650 BCF in 2020.

Invest in 03 gas-used industrial regions:

Southeast region capacity 200-300 BCF /y

Southwest region capacity 150-250 BCF /y

SongHong delta – Thaibinh capacity 35-70 BCF /y

Put into operation of interconnection and regional/national gas pipeline

systems.

Develop of gas fields in Southern of SongHong basin which is highly CO2

content.

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas Industry: ObjectivesGas Industry: Objectives

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas InGas Industry: Gasdustry: Gas--based industry areasbased industry areas

Future gas complex

Available gas complex

Songhong complex

Nghison complex

Dungquat complex

Binh Thuan complex

Phumy complexOmon

complex

Camau complex

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas InGas Industry: Pipelinesdustry: Pipelines

PETRO

Hon dat

105+5 km

50-60 km

omon PHU My

• Rang Dong – White Tiger –Phu My Associated gas (off-shore 107km,Ø16”) with Capacity of 2 BCM/year (operation 1995).

• Nam Con Son Natural gas (off-shore 362km Ø 26”& on-shore38km Ø 30”) with Capacity of 7.5 BCM/year (operation 2003).

• Low-pressure gas supply network of Phu My- Thu Duc (phase 1 operation 2003).

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas InGas Industry: Pipelinesdustry: Pipelines

PETRO

Hon dat

105+5 km

50-60 km

omon PHU My

• PM-3 (CAA) – Camau (off-shore 332km, Ø18”), Capacity 2 BCM/year, Operation 2006.

• Unocal Blocks-Omon (off-shore 270km, on-shore 130 km, Ø24”), Capacity of 6 BCM/year, Operation 2008.

• Phu My – Ho Chi Minh City (on-shore 71km, Ø22”) Capacity of 2BCM/year, operation 2007.

Existing Power PlantExpected Power PlantFertilizer Plant

Existing PipelinePipeline Under ConstructionExpected Pipeline from Block B

18 inch

06-2

PETRO

CARIGALI

CARIG

Hon dat

500KV Electric-line

PM3_CAA 2,5/2 bcm/year

Block B 52/972-3,7 Bcm/year

West & Red Orchid2,1- 2,7 Bcm/year 2002

270 km

105+5 km

289+43 km

50-60 km

Designl capacity6-7 Bcm/year

omon

16 inch

107 km

26 inch

365 km

24-26 inch

PHU My

Designl capacity2 Bcm/year

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas InGas Industry: Dinh co dustry: Dinh co –– PhuMy complexPhuMy complex

• Dinh co LPG plant (100% Petrovietnam), capacity 300,000 ton /year (operation 1998).

• Phu My UREA plant (100% Petrovietnam), capacity 740,000 tons/year (operation Sep.2004).

• Phu My Power plants:• PM I• PM 2.1; PM 2.1 Extension; PM 2.2• PM 3• PM 4

Existing Power PlantExpected Power PlantFertilizer Plant

Existing PipelinePipeline Under ConstructionExpected Pipeline from Block B

18 inch

06-2

PETRO

CARIGALI

CARIG

Hon dat

500KV Electric-line

PM3_CAA 2,5/2 bcm/year

Block B 52/972-3,7 Bcm/year

West & Red Orchid2,1- 2,7 Bcm/year 2002

270 km

105+5 km

289+43 km

50-60 km

Designl capacity6-7 Bcm/year

omon

16 inch

107 km

26 inch

365 km

24-26 inch

PHU My

Designl capacity2 Bcm/year

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas InGas Industry: Camau Powerdustry: Camau Power--Fertilizer ComplexFertilizer Complex

Camau Power-Fertilizer Complex:

• Urea plant : 800,000 tons of urea /year486 MM USD(100% Petrovietnam)

• Power plant: 720 MW 380 MM USD(100% Petrovietnam)• Feedstock: Natural gas from PM3-CAA block. • Operation: End 2006.

Existing Power PlantExpected Power PlantFertilizer Plant

Existing PipelinePipeline Under ConstructionExpected Pipeline from Block B

18 inch

06-2

PETRO

CARIGALI

CARIG

Hon dat

500KV Electric-line

PM3_CAA 2,5/2 bcm/year

Block B 52/972-3,7 Bcm/year

West & Red Orchid2,1- 2,7 Bcm/year 2002

270 km

105+5 km

289+43 km

50-60 km

Designl capacity6-7 Bcm/year

omon

16 inch

107 km

26 inch

365 km

24-26 inch

PHU My

Designl capacity2 Bcm/year

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas InGas Industry: Omon planned Power Plantsdustry: Omon planned Power Plants

Omon Power Plants

• Omon Power plants: I & II• Capacity: 3000 MW• Feedstock: Natural gas from B&52/97 blocks. • Operation: End 2008.

The Government pays special attention to gas industry.Gas industry has an important role in the national strategy of socio-economic development and energy security. It is one of the leading industries in the industrialization and modernization of our country.The potential reserves of gas is much larger than the discovered reserves. The country is very promised in oil and gas resources with almost 50% of potential are under-exploredGas potential is large, but the fields are scattered, discovered reserves is at medium level and in some areas CO2 content is high.

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas InGas Industry: dustry: OPPORTUNITIES & CHALLENGESOPPORTUNITIES & CHALLENGES

In the coming year, energy demand will increase rapidly. By 2020, gas demand will accounts for 20% of the total energy demandGas market has been newly established and the number of customer is slowly developedThe legal and fiscal regime is flexible and competitive in comparison with regional countriesThe opportunities open for all companies of all sizesVietnam is considered one of the most safety countries to invest

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas InGas Industry: dustry: OPPORTUNITIES & CHALLENGESOPPORTUNITIES & CHALLENGES

Expanding exploration and development activities throughout the countryMaintain gas production from current fields and increase gas production from developing fields Developing infrastructure – gas market and pipelines; diversify gas market consumptionPromote the application of technologies using gas as raw materialsAttracting more foreign investment:

• Improving legal and administrative framework, offer more incentives for foreign investors

• Preference given to companies with long- term commitments to gas projects

OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM OPPORTUNITIES FOR DEVELOPMENT OF NATURAL GAS IN VIETNAM Gas InGas Industry: dustry: OPPORTUNITIES & CHALLENGESOPPORTUNITIES & CHALLENGES

Request for More InformationRequest for More Information

Dr. Tran CanhPresident and CEO

Mr. Nguyen Dang LieuVice President

VIETNAM OIL AND GAS CORPORATION (PETROVIETNAM)22 Ngo Quyen Street,Hoan Kiem District, Hanoi, Vietnam

Tel: (844) 825 2526Fax: (844) 826 5942Website: www.petrovietnam.com.vn

Thank you for your attention

Petrovietnam