Logo of Phnom Penh Post newspaper Phnom Penh Post - KrisEnergy to consider selling stake in Block A

KrisEnergy to consider selling stake in Block A

Content image - Phnom Penh Post
KrisEnergy employees attach a rock bit to a drilling shaft at an oil platform. Randolph Yost

KrisEnergy to consider selling stake in Block A

Singapore-listed KrisEnergy Ltd is considering selling or farming out a stake in its Cambodia Block A offshore oilfield to ease its debt burden, according to the company’s 2016 year-end report.

The oil and gas company posted $237.1 million in net losses for the 2016 fiscal year due to non-cash charges and higher financial costs, it said in a document released yesterday. This was despite net revenue more than doubling over the same period, increasing by 137.3 percent to $142.8 million.

The firm said that it would consider selling its stake or farm out the development of the G10/48 Wassana oil field in Thailand as well as the Cambodia Block A field to increase cash flow.

“In line with appropriate risk management and prudent oil field practice, a farm-out or sales process to reduce our working interest in G10/48 and Cambodia Block A is appropriate, subject to obtaining a fair price for such farm-out or sales transaction,” it said.

“These developments will be core to our strategy in order to generate free cash flow from operations and provide for the repayment of our debt obligations beginning in 2022.”

Block A contains Cambodia’s only confirmed oil deposit and has been estimated to hold 700 million barrels of oil as well as 3 trillion to 5 trillion cubic feet of natural gas. It was previously reported that production from the block could reach 10,000 barrels per day.

KrisEnergy raised its stake in the 4,709-square-kilometre offshore block to 95 percent last October following a dispute with the other shareholders regarding revenue-sharing.

The year-end report notes that the company’s increased stake offset overall losses by increasing the value of its assets.

“The group’s unaudited net loss was partially mitigated by other income amounting to $100.2 million which was primarily driven by gains recognised during FY2016 for the transfer of working interests in relation to Cambodia Block A amounting to $81.0 million,” it said.

MOST VIEWED

  • Archaeologists find ancient remnant

    A team from the Apsara National Authority (ANA) has discovered a gatekeeper statue’s foot fragment at the Tonle Snguot Temple, within a metre of the toe of a statue found in 2017. ANA spokesman Long Kosal told The Post on Wednesday that the fragment was

  • Hun Sen to the rescue

    Cambodia has won praise for allowing passengers of the MS Westerdam cruise ship to dock at Preah Sihanouk port, thanks to Prime Minister Hun Sen’s humanitarian act. In a message via Twitter on Wednesday, the director-general of the World Health Organisation Tedros Adhanom Ghebreyesu

  • EU partially withdraws EBA

    The EU Commission on Wednesday announced the partial withdrawal of the Everything But Arms (EBA) scheme, citing a serious and systematic violation by Cambodia of principles in the four core human and labour rights. The suspension affects one-fifth or €1 billion ($1.08 billion) of Cambodia’s annual

  • Japan calls for policy changes

    Representatives of Japanese companies and investors on Wednesday submitted a list of policy recommendations to the government concerning 21 challenges to the Kingdom’s business climate. Japanese Ambassador to Cambodia Masahiro Mikami and leaders of the Japanese Business Association in Cambodia (JBAC), Japan International Cooperation Agency

  • Trump tweets praise for Kingdom docking ship

    Cambodia continues to earn praise for its humanitarian act of allowing the MS Westerdam cruise ship with more than 2,200 passengers and crew on board to dock at the Preah Sihanouk port. The praise this time comes from none other than US President Donald Trump. “Thank

  • Hate worse than virus, PM says

    Prime Minister Hun Sen on Tuesday criticised countries that have cancelled flights with China following the outbreak of the Novel Coronavirus (2019-nCoV), arguing that such moves amounted to discrimination against the Chinese. In a speech delivered during the groundbreaking ceremony for work on national roads 2