A June 14, 2021, article discussing Cambodia’s future as an oil producer features insights from Jay Cohen, partner and director of Tilleke & Gibbins in Cambodia and the country head of Tilleke & Gibbins’ regional energy practice. The article, which was published by Nikkei Asia, considers possible routes forward for exploitation of the country’s oil and gas reserves in light of the recent insolvency of KrisEnergy, which had just begun producing oil from an offshore Cambodian concession.
The article explains that KrisEnergy, a Singapore-based company, was forced to declare bankruptcy shortly after they began operating their share of a Cambodian concession they purchased several years ago from Chevron. They found that the concession contained a lower volume of accessible oil than expected, and the revenue would not be enough to cover their mounting debts. Nevertheless, just days later Cambodia went ahead with a ceremony to mark the country’s first drops of oil—produced by the concession to KrisEnergy. The ceremony demonstrates the high hopes that Cambodia has placed on the potential of its oil resources to bring economic transformation, but also highlights the uncertainty facing these plans now that the country is left without an operator to extract the oil.
In the article, several experts in the Cambodian energy market discussed the developments and shared their thoughts on where the country’s oil ambitions might go from here. Jay commented specifically on KrisEnergy’s discovery that the concession contained a smaller amount of recoverable oil than originally assumed. He emphasized that the commercial viability of the concession will have to be reassessed to determine whether reviving production with a different operator is a practical possibility.
The full article is available on the Nikkei Asia website.