Logo of Phnom Penh Post newspaper Phnom Penh Post - Block D offshore oil licence revoked

Block D offshore oil licence revoked

Block D offshore oil licence revoked

The government revoked the offshore oil exploration license of CPHL (Cambodia) Co Ltd after the project failed to meet the terms of its petroleum agreement, a state official said yesterday.

Meng Saktheara, secretary of state at the Ministry of Mines and Energy (MME), said his ministry notified CPHL last week that it had cancelled the company’s contract to explore for oil in Block D, an offshore concession spanning 5,500 square kilometres in the Gulf of Thailand.

“There was communication between the ministry and the contracting party about the failure of the company to fulfil the obligations of its petroleum agreement,” he said.

“And because of this failure it was decided to terminate the contract.”

Singapore-based Mirach Energy Ltd, which owns a 48-per cent interest in CPHL (Cambodia) Co Ltd, announced in a filing on Thursday that it had lost its Block D licence. It added, however, that MME had granted it a six-month exclusivity window during which no other investor would be allowed to bid on the concession.

CPHL was “given priority to apply for a new petroleum agreement for Block D on certain terms and conditions, including that of getting new investment partner(s) to bid for Block D under a joint venture,” it said in the filing.

In 2006, Cambodia granted CPHL, then doing business as China Zhen Rong Cambodia Energy, sole exploration rights of Block D for seven years, and production rights for 30 years. Last August, the government agreed to extend CPHL’s exclusive exploration rights through 2018.

However, in recent months the ministry has pressed the company to step up its exploration work and settle its financial obligations.

Saktheara confirmed that CPHL would be permitted to reapply for the Block D license, but only after “fulfilling its physical and financial obligations to the Cambodian government.”

He declined to specify the conditions and fees involved, but said the company was aware of them.

In its 2015 financial report, Mirach said exploration of the block had “stalled” while awaiting a response from MME on a proposed financial arrangement.

MOST VIEWED

  • Hong Kong firm done buying Coke Cambodia

    Swire Coca-Cola Ltd, a wholly-owned subsidiary of Hong Kong-listed Swire Pacific Ltd, on November 25 announced that it had completed the acquisition of The Coca-Cola Co’s bottling business in Cambodia, as part of its ambitions to expand into the Southeast Asian market. Swire Coca-Cola affirmed

  • Cambodia's Bokator now officially in World Heritage List

    UNESCO has officially inscribed Cambodia’s “Kun Lbokator”, commonly known as Bokator, on the World Heritage List, according to Minister of Culture and Fine Arts Phoeurng Sackona in her brief report to Prime Minister Hun Sen on the night of November 29. Her report, which was

  • NagaWorld union leader arrested at airport after Australia trip

    Chhim Sithar, head of the Labour Rights Supported Union of Khmer Employees at NagaWorld integrated casino resort, was arrested on November 26 at Phnom Penh International Airport and placed in pre-trial detention after returning from a 12-day trip to Australia. Phnom Penh Municipal Court Investigating Judge

  • Sub-Decree approves $30M for mine clearance

    The Cambodian government established the ‘Mine-Free Cambodia 2025 Foundation’, and released an initial budget of $30 million. Based on the progress of the foundation in 2023, 2024 and 2025, more funds will be added from the national budget and other sources. In a sub-decree signed by Prime Minister Hun Sen

  • Two senior GDP officials defect to CPP

    Two senior officials of the Grassroots Democratic Party (GDP) have asked to join the Cambodian People’s Party (CPP), after apparently failing to forge a political alliance in the run-up to the 2023 general election. Yang Saing Koma, chairman of the GDP board, and Lek Sothear,

  • Cambodia's poverty cut in half from 2009 to 2019: World Bank report

    A report published by the World Bank on November 28 states that Cambodia’s national poverty rate fell by almost half between 2009 and 2019, but the Covid-19 pandemic recently reversed some of the poverty reduction progress. Cambodia’s poverty rate dropped from 33.8 to 17.8 per cent over the 10