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    Boc - Verification Report

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    Lena Phan
    Southwest Pipeline Operating Company had a third party verify the capital expenditure (CAPEX) report for the Block B-O Mon Pipeline project based on an updated feasibility study. The verification found that CAPEX decreased by $1.49 million before VAT and $1.64 million after VAT. The decreases were due to updates in construction costs, equipment costs, and other factors. The verification consultant concluded that CAPEX in the updated feasibility study satisfied cost estimation requirements. Southwest Pipeline is providing the verification results to request approval of the updated feasibility study so the project can proceed to the next steps.

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    Boc - Verification Report

    Uploaded by

    Lena Phan
    34 views3 pages
    Southwest Pipeline Operating Company had a third party verify the capital expenditure (CAPEX) report for the Block B-O Mon Pipeline project based on an updated feasibility study. The verification found that CAPEX decreased by $1.49 million before VAT and $1.64 million after VAT. The decreases were due to updates in construction costs, equipment costs, and other factors. The verification consultant concluded that CAPEX in the updated feasibility study satisfied cost estimation requirements. Southwest Pipeline is providing the verification results to request approval of the updated feasibility study so the project can proceed to the next steps.

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    161216 Boc - Verification report.docx

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    Southwest Pipeline Operating Company had a third party verify the capital expenditure (CAPEX) report for the Block B-O Mon Pipeline project based on an updated feasibility study. The verification found that CAPEX decreased by $1.49 million before VAT and $1.64 million after VAT. The decreases were due to updates in construction costs, equipment costs, and other factors. The verification consultant concluded that CAPEX in the updated feasibility study satisfied cost estimation requirements. Southwest Pipeline is providing the verification results to request approval of the updated feasibility study so the project can proceed to the next steps.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    34 views3 pages

    Boc - Verification Report

    Uploaded by

    Lena Phan
    Southwest Pipeline Operating Company had a third party verify the capital expenditure (CAPEX) report for the Block B-O Mon Pipeline project based on an updated feasibility study. The verification found that CAPEX decreased by $1.49 million before VAT and $1.64 million after VAT. The decreases were due to updates in construction costs, equipment costs, and other factors. The verification consultant concluded that CAPEX in the updated feasibility study satisfied cost estimation requirements. Southwest Pipeline is providing the verification results to request approval of the updated feasibility study so the project can proceed to the next steps.

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    You are on page 1of 3

    PETROVIETNAM OIL AND GAS GROUP

    SOUTHWEST PIPELINE OPERATING COMPANY


    20th Floor, Vietcombank Tower, No. 5 Me Linh Square,
    Ben Nghe Ward, District 1, Ho Chi Minh City
    Tel: +84.8 35219081 Fax: +84.8 35219080

    To: MOECO Fax No: (84-4)


    39369097
    Attn: Mr. Tomoaki Sato – BoC member
    To: PTTEP Fax No: (66-2)
    5374444
    Attn: Mr. Monton Santivongskul – BoC Member

    Our Ref. /SWPOC-


    Number of page(s): 2
    TM-KT
    Date: December , 2016
    Subject: Verification of CAPEX report and Updated Feasibility Study
    Rev.01

    Dear Sirs,

    As requested by BCC Parties, Southwest Pipeline Operating Company


    (SWPOC) carried out the verification of CAPEX for the Block B - O Mon
    Pipeline project based on the Feasibility Study (FS) update Rev.00.
    SWPOC would like to provide the results of the verification report as
    follows:
    - Third-party verification consultant: Institute of Construction Economics -
    Ministry of Construction
    - Contract duration: December 9th to 19th, 2016
    - Verification results:
    1. Impact on CAPEX:
    Unit: USD

    Value before Value after


    No. Description Difference
    verification verification

    (1) (2) (3) (4) (5)=(4)-(3)

    I CAPEX (before VAT) 1,164,938,481 1,163,447,482 -1,490,999

    II CAPEX (after VAT) 1,279,411,141 1,277,771,043 -1,640,099


    2. Reasons for increase/decrease:
    Unit: USD
    Differenc
    No. Description e (before Note
    VAT)
    I Construction 2,023,333 Updating cost of the PLEM at
    cost KP209 to connect with the 18 inch
    1
    Differenc
    No. Description e (before Note
    VAT)
    spurline to Ca Mau Gas-Power-
    II Equipment cost 3,767,805
    Fertilizer complex.
    Project
    Updating audit result and
    III Management -20,890
    overhead cost
    cost
    Recalculating based on the
    Consulting
    IV 217,193 updated construction & equipment
    service costs
    costs
    - Updating to comply with current
    V Other costs 12,994,70 law & regulation, with major
    4 decrease in insurance cost
    Updating to include the average
    fluctuation of construction price
    VI Contingency 5,516,265
    index in calculating contingencies,
    complying with current regulation
    -
    Total 1,490,99
    9

    3. Conclusion: based on the verification results, verification


    consultant concluded that CAPEX in FS update Rev.00 satisfied
    the requirements of construction project cost estimation.
    CAPEX after verification is the basis for SWPOC to submit to
    authorities for appraisal and approval per Vietnamese Law.

    - PV Engineering agreed with the verification results and had updated the impacted
    sections of the FS update (i.e Narrative and Economics, no impact on Technical
    section). Consequently, tariff in Rev.01 was not materially affected in comparison
    with Rev.00.

    In conclusion, the verification of CAPEX by third party decreased CAPEX by 1.6 Million
    USD after VAT, which is not a significant change and did not materially affect tariff
    calculation. Therefore, SWPOC provide the verification results above for information and
    kindly request that Foreign Partners approve the Feasibility Study Rev.01 so SWPOC can
    proceed with next steps forward.

    Yours sincerely,

    Do Khang Ninh
    General Director
    Cc :

    2
    - Record, Commercial, Tech.
    Attachment:
    - Verification of CAPEX report
    - Updated Feasibility Study Rev. 01

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