Chevron report completed

A tuk tuk driver parks outside a Caltex petrol station in Phnom Penh yesterday. Photograph: Pha Lina

Tuesday, 26 June 2012
Don Weinland
The Phnom Penh Post

Chevron has completed an environmental assessment for oil production in Cambodia’s Block A offshore oil field, a step insiders called important for the proposed extraction that appeared to stall early this year.

The Environmental Impact Assessment (EIA), completed in March and obtained yesterday by the Post, was the first to be seen publicly after Chevron’s 10 years in the Kingdom.

Documenting a rough three-phase plan, the EIA shows Chevron building up to 10 platforms during a nine-year period.

Risks associated with Chevron’s potential production were listed as “low” or “insignificant”.

In October, China’s CNOOC was the first oil company to issue an EIA for exploratory drilling – as required by Cambodian law.

Japan’s JOGMEC followed suit in December for onshore exploration. Questions on the existence of an EIA for Chevron’s exploration have yet to be answered.

The company drilled 18 exploratory wells before announcing a commercial discovery in August 2010. It has a 30 per cent interest in the 4,709 square kilometre field.

December 12, 2012 – or 12-12-12 – was originally marked as the start date for Chevron’s production.

In a speech last year, Prime Minister Hun Sen even said he would cancel the company’s contract if production did not start on the auspicious date.

Although Chevron has long answered questions on a production date by simply stating it is “continuing to work with the Royal Government of Cambodia” to reach an investment decision, a government spokesman in January said the timeframe would not be met.

In April, Chevron said it expected approval of a production permit by the end of this year. Both Chevron and the government have been silent about the reasons for delays.

Chevron representatives did not respond to emailed questions yesterday. The Cambodian National Petroleum Authority declined to comment.

The completion of the EIA was “a good start for a giant company in Cambodia”, Mam Sambath, director of Development Partnership in Action, said yesterday.

But questions over the oil company’s exploratory assessment are still unresolved.

“We saw the exploration EIAs for the Chinese and the Japanese companies. And suddenly we see the EIA for development from Chevron. We don’t know about the exploration EIA,” he said. “We are surprised sometimes.”

China’s CNOOC last year invested up to US$200 million in an exploratory well in Cambodia’s offshore Block F. Drilling reportedly began in December.

Industry watchers labeled the Chinese operation as a good example when it completed the first EIA in October.

The same held true for Japan’s JOGMEC, which completed an exploratory EIA the following month.

Chevron’s EIA will be discussed at a meeting at the Ministry of Environment on Friday.

Although encouraged by the assessments, civil society groups have said that they have not been given enough time to review the reports.

Mam Sambath said his organisation received the EIA last Friday, giving his team only one week to review and verify the findings.