Cambodia: KrisEnergy to consider selling stake in Block A

Cambodia: 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.

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com