Oil and Gas Revenue Management Options for Cambodia

At a moderate rate of production, Cambodia’s oil and gas revenue could provide revenues of around $500 million a year for 20-25 years, and is estimated to peak in revenue at between $1.7 billion and $6 billion per annum for a small number of years. However, a recent drop in the value of oil and gas, which is forecast to continue into the foreseeable future, largely due to a number of large gas projects commencing production across the world, may have reduced the interest and profitability in developing Cambodia’s oil and gas reserves. This may have played a role in Chevron’s recent sale of their production rights, at a loss of approximately $100 million. Licenses for exploration and production of Cambodia’s oil and gas wealth are divided into blocks, as shown in figure 1, below. Block A is so far the most advanced in terms of exploration, while the sovereignty of a number of blocks, referred to as Overlapping Claims Areas (OCAs) is currently under dispute between Cambodia and Thailand(download).

No oil for up to five years : Cambodian government

The Phnom Penh Post reported on 26 february 2014 that It will be years before oil starts to be produced by energy giant Chevron’s offshore site in the Gulf of Thailand. 

Meng Saktheara, secretary of state at the Ministry of Mines and Energy, said that negotiations over taxation have continued to stall the approval of Chevron’s permit to extract, and though Saktheara is confident a resolution will be found soon, it could take “three to five years” for Cambodia to see its first drop of oil. (Read more...)