Tuesday, June 24, 2008

SOCO to start pumping 16,000 bpd of oil in Thailand

Soco FY profit up, sees two key fields on stream in coming months UPDATE
03.26.08, 5:45 AM ET

LONDON (Thomson Financial) - Soco International PLC reported increased profits in 2007 and announced that two of its key oil fields are on track to be stream in the next few months.

Pretax profit rose to 57.1 mln usd in 2007 from 48.1 mln previously, while net profit grew to 32.3 mln usd from 29.1 mln. Revenue increased to 98.4 mln usd from 76.5 mln on higher oil prices which offset the impact of a fall in production to 6,316 barrels per day from 6,766 barrels.

Ed Story, the chief executive, gave an upbeat view of the future, with two of the group's main projects expected to start production in the next few months.

The CNV field in Vietnam will be on stream in the middle of 2008, while first oil from the Bualuang field in Thailand is expected in the second quarter.

'With near term production from the CNV field in Vietnam and the Bualuang field in Thailand, medium-term development and exploration upside in Vietnam and long-term exploration potential in West Africa, we are very optimistic about Soco's future growth prospects,' he said.

Story told Thomson Financial News in a phone interview CNV is capable of producing around 20,000-25,000 barrels of oil equivalent per day, while Bualuang could pump around 16,000 barrels of oil a day. Soco holds a 25 pct stake in CNV and a 40 pct interest in Bualuang.

Oil from Bualuang will be supplied to domestic refineries, while output from CNV will be exported to Japan. These projects would 'far more than replace the production we will lose from the sale of the assets in Yemen,' Story said. Soco gets its existing production from the East Shabwa field in Yemen, in which it partly owns. Last month, the group agreed to sell its operations in Yemen in China's Sinochem Petroleum Ltd for 465 mln usd in cash. The deal is expected to be completed next month.

Proceeds from the disposal will fund the group's aggressive exploration and development projects, including the TGT field on Block 16-1 in Vietnam. Soco said it is confident TGT will be declared ready for commercial development before the end of the first half.

Story said the consortium developing TGT, in which Soco is a 30 pct shareholder, will be embarking on a 'fast-track' programme aimed bringing the field on stream by 2010.

TGT is expected to initially pump around 50,000 barrels a day, which could go up to 150,000 barrel, Story added.

For 2008, Soco is allocating 180 mln usd to fund its ongoing projects, the same amount it spent in 2007, he said. The group's capital spending rose to 179 mln usd in 2007 from 114 mln usd last time.

monicca.egoy@thomson.com

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