Pharos Energy, an independent energy company with assets in Vietnam and Egypt, has announced that the applications for five-year licence extensions to the Company's two producing assets in Vietnam, the TGT and CNV fields, have been formally granted by the Vietnamese Government to the Hoang Long Joint Operating Company and the Hoan Vu Joint Operating Company respectively. The partners in the JOCs will now formally approve and enter into supplementary documentation to finalise the extensions. This will result in extension of the licence for the TGT field to 7 December 2031, and extension of the licence for the CNV field to 15 December 2032.
Highlights:
- Potential to increase TGT and CNV's Net Present Value by more than 50%
- Increase to estimated year-end 2024 2P reserves of approximately 10%* in Vietnam
- Scope for further reserves increase of approximately 70%* with the work programme of additional infill drilling and success in the appraisal programme
Katherine Roe, Chief Executive Officer, commented:
'The granting of the TGT and CNV licence extensions is a significant milestone for the Company and a key catalyst to unlocking untapped potential within our existing portfolio. This is very welcome news and allows us to prioritise future investment to extract and grow value from our assets. I would like to thank our team in Vietnam for their hard work in securing the approvals; they are testament to Pharos' long-nurtured working relationships and our standing in-country as a valued industry participant. I would also like to thank the Vietnamese Government and we look forward to working with them throughout the extended period.
Pharos is well positioned for future growth and we remain committed to continue supporting the Vietnamese Government's energy security agenda through our investments in TGT and CNV, as well as progressing our exciting position in Blocks 125 & 126.'
These licence extensions provide the catalyst for initiating the planned work programme expected to commence with the drilling of an appraisal well in the TGT field in Q4 2025. The extensions also unlock value with the drilling of additional infill wells. The extensions are expected to result in an increase to the TGT and CNV 2024 year-end 2P reserves of approximately 10%*, with potential to further increase reserves through appraisal success and infill wells. Based on internal management analysis, the extensions have the ability to increase the NPV of TGT and CNV by more than 50%.
In consideration for granting the licence extensions, Pharos' working interest will reduce after the current licences expire in December 2026 and 2027 respectively. The working interest for TGT will change from 30.5% to 25.3% and likewise, CNV will change from 25% to 20%. The extensions are accompanied by an agreed work programme commitment of 3D seismic reprocessing and one appraisal well on each field. Certain other licence terms have been revised to be consistent with precedent extensions granted to other operators by the Vietnamese Government and are in line with the current Petroleum Law provisions.
For more information on the terms of the licence extensions, please visit https://www.pharos.energy/investors/results-reports-and-presentations/.
(*) Estimated reserves are not audited and subject to further review and amendment. Further volumes are adjusted for revised working interests and include a progression of 2C with additional drilling and prospective resources with appraisal success.
Source: Pharos Energy
