May 24, 2010
International oil companies started exploration for oil and gas in the late 1950s and continued until the outbreak of conflict in 1970. They found little in the way of significant reserves and suspended activities during the conflict period (1975–1991). Exploration activities resumed in 1991, with Cambodia identifying and bidding out onshore and offshore exploration blocks to international oil companies. In 2005, ChevronTexaco (Chevron) announced that it had found oil in block A of its offshore concession. This oil find is estimated on a preliminary basis at around 400–700 million barrels of oil.
Natural gas deposits, estimated at 3–5 trillion cubic feet, are also reported, both as associated gas and gas pockets.
Chevron has stated that it intends to commence production from block A in 2010. Blocks B, C, and D are also under exploration, while offshore blocks E and F and onshore blocks 11, 12, 13, and 26 are currently being offered for tender. Thus there seems to be considerable potential for finding oil and gas resources within Cambodia’s territory.
Estimates indicate that the Government might reasonably receive $500 million to $1 billion a year from oil and gas production. This will largely depend on the oil and gas flows and on the agreed production rates. Nevertheless, compared with total Government revenues of about $665 million in 2005, this revenue is significant and does not include the possible income from other adjoining offshore blocks currently under exploration.
A donor working group on oil and gas was established in January 2006. This working group comprises ADB, Australian Aid for International Development, the Japan International Cooperation Agency, the International Monetary Fund, the Norwegian Agency for Development Cooperation, the United Nations Development Programme, and the World Bank.
Block 15 is located at the northeast of the Tonle Sap Lake in the Cambodian inland, where oil availability is estimated for 30 years, and gas availability for 35 years, and the exploration will take 7 years.