SINGAPORE - Oil and gas exploration and production firm KrisEnergy said on Tuesday that one of its partners in Vietnam has defaulted on payments and will have to withdraw from the partnership.
Neon Energy (Song Hong), which held a 25 per cent interest in two Vietnam contract areas, has failed to pay cash calls and interest amounting to US$22.1 million (S$27.7 million), KrisEnergy said.
KrisEnergy originally held a 25 per cent interest in the contract areas while another partner, Eni Vietnam, held the remaining 50 per cent.
With Neon Energy's default, the stakes of KrisEnergy and Eni Vietnam in the two blocks will rise to 66.7 per cent and 33.3 per cent respectively.
Neon Energy will still have to pay the default amount to KrisEnergy and Eni Vietnam.
"It is with regret that we see Neon leave the joint operating agreements but this also provides an opportunity for us to increase our working interest at relatively low cost in two exploration blocks which we believe remain prospective," said KrisEnergy's business development director Richard Lorentz.