Chevron expects 2-year delay in Vietnam gas project

HANOI, June 15 Sun Jun 14, 2009 9:47pm EDT

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HANOI, June 15 (Reuters) - U.S. oil major Chevron (CVX.N) expects its natural gas project in Vietnam to be delayed until late 2014 due to prolonged negotiations over gas prices with oil monopoly Petrovietnam.

Chevron said last year it wanted to start gas production in 2012 from the project off the southwest coast of Vietnam.

The weekly Vietnam Investment Review quoted Chevron's Vietnam representative, Jim Ollen, as saying the negotiations with Petrovietnam were "progressing well".

A company official reached by telephone at the Chevron representative office in Hanoi confirmed the details in the report.

"First production is expected in 2014, instead of 2012," she said, declining to elaborate. Ollen was not immediately available to comment.

The report also quoted Ollen as saying reference prices provided by the Asian Development Bank of $5.8 to $8.2 per million British thermal units could help the two companies reach an agreement on prices soon.

Chevron, which has a 43 percent stake in the development, would invest up to $2 billion in the $4 billion project that includes a gas pipeline and power plants, Ollen was quoted as saying.

Other investors in the project, which comprises Blocks B, 48/95 and 52/97, include Thailand's PTTEP PTTE.BK and Japan's Mitsui Oil. (Reporting by Nguyen Nhat Lam; Editing by Lincoln Feast)

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