Pharos Energy

Pharos Energy plc is a United Kingdom-based independent oil and gas exploration and production company headquartered in London. The business was established in April 1997 by Ed Story and first listed on the London Stock Exchange in May of the same year under the name SOCO International. In October 2019, it adopted the Pharos Energy name as part of a repositioning of the group and following sustained criticism connected with its former exploration activities in and around Virunga National Park in the Democratic Republic of the Congo. The company’s activities have historically covered exploration, appraisal, development and production of crude oil and natural gas. Its portfolio has changed substantially over time. Earlier operations included interests in Tunisia, Yemen, Thailand, Mongolia, Angola, the Republic of Congo and the Democratic Republic of the Congo. Several of those positions were sold or relinquished as the company sought to concentrate capital on producing assets and selected exploration opportunities. By the late 2010s, the group had exited its sub-Saharan African assets other than Egypt and had shifted its strategic emphasis toward the Middle East and Asia. Vietnam has been one of Pharos Energy’s longest-running operating areas. The company has been active there since the 1990s and has held interests in offshore Block 9-2, containing the Ca Ngu Vang field, and Block 16-1, containing the Te Giac Trang field. The relevant petroleum contracts were signed in 2000 and 1999 respectively. Ca Ngu Vang was discovered in 2002, while Te Giac Trang was discovered in 2005. In 2002, the group farmed out half of its Vietnamese interests to PTT Exploration and Production, creating a partnership structure for further development and production. Egypt became another central part of the portfolio after Pharos agreed in September 2018 to acquire Merlon Petroleum El Fayum Company and the entire El Fayum concession. The transaction was completed in April 2019. The company subsequently identified further evaluation opportunities in the North Beni Suef concession and announced work intended to reduce carbon dioxide emissions associated with the El Fayum operation. Pharos has also maintained exploration exposure in Israel and Vietnam. In October 2019, the Israeli energy authorities awarded a consortium involving Pharos, Cairn Energy and Ratio Oil eight offshore exploration licences. In Vietnam, the company continued evaluating offshore blocks 125 and 126 in the Phu Khanh basin, although planned three-dimensional seismic work was deferred in 2020. The company’s earlier expansion was marked by both acquisitions and disposals. It began production from Tunisia’s Didon field in 1998 and later exited its Didon and Zarat interests. It sold its Yemen operations to Sinochem in 2008, its Thai Bualuang interests to Salamander Energy in 2010, its Mongolian assets to a PetroChina subsidiary in 2005, its Angola interests in 2016, and its Republic of Congo interests in 2018. These transactions reduced the geographic breadth of the portfolio and supported a more focused operating model. Pharos remains a London-listed energy company whose principal business is upstream oil and gas rather than refining, fuel retailing or power generation. Its brand reflects a narrower geographic strategy than the former SOCO International business, combining production in Vietnam and Egypt with selective exploration in Israel and other Asian or Middle Eastern opportunities.

Pharos Energy began life as SOCO International in April 1997, when it was founded by Ed Story. The company obtained a London Stock Exchange listing in May 1997 and developed an upstream business based on acquiring, exploring and developing oil and gas licences in multiple regions. Vietnam became an important early area of activity: the company had been active in the country since 1996, signed the petroleum contract for Block 16-1 in May 1999, and signed the Block 9-2 contract in 2000. The Ca Ngu Vang field was discovered in 2002 and the Te Giac Trang field in 2005. That same broad period also saw the company farm out 50 percent of its Vietnamese interests to PTT Exploration and Production. During the 2000s, SOCO pursued a geographically diverse portfolio. It commenced production from Tunisia’s Didon field in 1998, sold Mongolian assets to a PetroChina subsidiary in 2005, entered the Republic of Congo through a production-sharing agreement in 2006, and held interests in Angola from 2007. Production from Thailand’s Bualuang field began in 2008. In the same year, SOCO agreed to sell its Yemen operations to Sinochem. In 2010, it agreed to sell the Thai assets to Salamander Energy and described a drilling programme intended to reduce risk around a substantial prospective resource base in Vietnam and the Democratic Republic of the Congo. The company’s activities in the Democratic Republic of the Congo became the most controversial period in its history. In 2010, a presidential decree gave SOCO permission to explore for hydrocarbons in Block V in the southern Albertine Graben. The block included areas associated with Virunga National Park and Lake Edward. SOCO began work in the region in 2012, including exploration-related studies, and encountered opposition from conservation organisations and people who objected to potential activity in or near the park. Allegations were made that company-linked personnel used intimidation and attempted bribery; company representatives disputed some of the allegations. International criticism intensified because Virunga is a UNESCO World Heritage Site and an important habitat for endangered mountain gorillas. In June 2014, SOCO and the World Wildlife Fund issued a joint declaration under which further drilling would not proceed unless UNESCO and the Congolese government agreed that it was compatible with the site’s World Heritage status. The company subsequently ceased its DRC operations in August 2014 and later exited its remaining African positions outside Egypt. SOCO continued rationalising its portfolio. It sold its Angola interests in 2016 and its Republic of Congo interests in 2018. Egypt became strategically important after the company agreed in September 2018 to acquire Merlon Petroleum El Fayum Company and the full El Fayum concession; completion occurred in April 2019. The transaction gave the group a producing position in Egypt and complemented its established Vietnamese production. On 16 October 2019, SOCO International announced that it would operate under the name Pharos Energy plc. The rebranding followed the Virunga controversy and accompanied a stated strategic emphasis on the Middle East and Asia. The following day, John Martin was announced as the successor to Rui de Sousa as non-executive chair. Pharos also joined Cairn Energy and Ratio Oil in receiving eight offshore exploration licences from Israel’s energy authorities in October 2019. In 2020, the company continued operating two Vietnamese producing blocks, Block 9-2 containing Ca Ngu Vang and Block 16-1 containing Te Giac Trang. It also evaluated the North Beni Suef concession in Egypt and identified measures to reduce emissions at El Fayum. Evaluation of Vietnam’s Phu Khanh basin blocks 125 and 126 continued, although planned three-dimensional seismic work was postponed. The resulting business is more focused than the former SOCO portfolio: Pharos is primarily an upstream oil and gas company with producing assets in Vietnam and Egypt and selected exploration interests in Israel and Asia.

• 2020

  Portfolio evaluation and emissions-reduction work

  [1]Pharos Energyen.wikipedia.org

  Pharos continues evaluating Vietnamese offshore blocks, assesses North Beni Suef in Egypt and targets emissions reductions at El Fayum.

• 2019

  Rebrands as Pharos Energy

  [1]Pharos Energyen.wikipedia.org

  The company completes the Egyptian acquisition, adopts the Pharos Energy name and changes its non-executive chair.

• 2018

  Egypt acquisition agreed and Congo interests sold

  [1]Pharos Energyen.wikipedia.org

  The company agrees to acquire Merlon Petroleum El Fayum Company and the El Fayum concession, while also selling its Republic of Congo interests.

• 2016

  Angola interests sold

  [1]Pharos Energyen.wikipedia.org

  The group disposes of its interests in Angola.

• 2014

  Virunga exploration suspended

  [1]Pharos Energyen.wikipedia.org

  Following international pressure over activity in Virunga National Park, the company commits to suspending further exploration in the area.

• 2010

  Thai assets sold and exploration programme expanded

  [1]Pharos Energyen.wikipedia.org

  The company agrees to sell its Thai assets to Salamander Energy and pursues a drilling programme focused on Vietnam and the Democratic Republic of the Congo.

• 2008

  Yemen disposal and Thai production

  [1]Pharos Energyen.wikipedia.org

  SOCO agrees to sell its Yemen operations to Sinochem, while production begins from the Bualuang field in Thailand.

• 2005

  Te Giac Trang field discovered

  [1]Pharos Energyen.wikipedia.org

  The Te Giac Trang field is discovered in Vietnam’s Block 16-1.

• 2002

  Vietnam farm-out and Ca Ngu Vang discovery

  [1]Pharos Energyen.wikipedia.org

  SOCO farms out half of its Vietnamese interests to PTT Exploration and Production, and the Ca Ngu Vang field is discovered in Block 9-2.

• 2000

  Block 9-2 contract signed in Vietnam

  [1]Pharos Energyen.wikipedia.org

  The company signs the petroleum contract for Block 9-2.

• 1999

  Block 16-1 contract signed in Vietnam

  [1]Pharos Energyen.wikipedia.org

  The group signs the petroleum contract for Vietnam’s Block 16-1.

• 1998

  Tunisia production begins

  [1]Pharos Energyen.wikipedia.org

  Production starts from the Didon field in Tunisia.

• 1997

  SOCO International is founded and listed

  [1]Pharos Energyen.wikipedia.org

  Ed Story establishes the company in April, and SOCO International is admitted to the London Stock Exchange in May.

• 1996

  Begins activity in Vietnam

  [1]Pharos Energyen.wikipedia.org

  The company begins its long-term involvement in Vietnam, which later becomes one of its principal producing regions.

An independent upstream energy company focused on developing and producing oil and gas through a geographically concentrated portfolio in the Middle East and Asia.

• Oil and gas production · 1996

  Vietnam upstream production

  Pharos’s Vietnamese production portfolio is centred on offshore Block 9-2 and Block 16-1. Block 9-2 contains the Ca Ngu Vang field, discovered in 2002, while Block 16-1 contains the Te Giac Trang field, discovered in 2005. The company has been active in Vietnam since the 1990s and operates these assets through partnerships, including a 2002 farm-out of half of its Vietnamese interests to PTT Exploration and Production.

• Oil production · 2019

  El Fayum concession

  The El Fayum concession in Egypt became a core Pharos asset after the company agreed to acquire Merlon Petroleum El Fayum Company and the full concession in 2018. The acquisition completed in 2019. Subsequent work included evaluating adjacent or related opportunities such as North Beni Suef and identifying measures intended to reduce carbon dioxide emissions from operations.

• Oil and gas exploration · 2019

  Israel offshore exploration licences

  In October 2019, Pharos joined Cairn Energy and Ratio Oil in receiving eight offshore exploration licences from Israel’s energy authorities. The licences expanded the company’s exploration exposure in the Middle East and complemented its producing interests in Egypt and Vietnam.

• Oil and gas exploration

  Phu Khanh basin blocks 125 and 126

  Pharos has evaluated offshore blocks 125 and 126 in Vietnam’s Phu Khanh basin. In 2020, the company stated that evaluation would continue, although planned three-dimensional seismic work was deferred, potentially into the following year.

• 2014

  Controversy over exploration in Virunga National Park

  SOCO International faced international condemnation over exploration-related activity in Virunga National Park in the Democratic Republic of the Congo. Conservation groups opposed the work because Virunga is a UNESCO World Heritage Site and habitat for endangered mountain gorillas. Allegations also concerned intimidation and attempted bribery of people opposing the activity, allegations that company representatives disputed. The company later agreed to suspend further exploration and ceased its DRC operations.

  Source

Read more

• 2014Virunga conservation commitment

  Democratic Republic of the Congo · International

  After sustained criticism from conservation organisations over exploration in Virunga National Park, SOCO signed a joint declaration with the World Wildlife Fund stating that it would not drill unless UNESCO and the Congolese government agreed that such activity was compatible with the site’s World Heritage status.

  Outcome. The company suspended further exploration in the area and subsequently exited its Democratic Republic of the Congo operations.

  Source

• 2020

  Evaluation of growth and emissions prioritiesStrategy

  Background

  Pharos continued assessing exploration opportunities while managing its existing producing assets.

  Action taken

  The company continued evaluating Vietnam’s Phu Khanh basin blocks, assessed North Beni Suef in Egypt and targeted carbon dioxide reductions at El Fayum. Planned three-dimensional seismic work in Vietnam was deferred.

  Aftermath

  The programme reflected a more selective exploration approach alongside operational and environmental improvements in Egypt.

  Source

• 2019

  Corporate rebrand to Pharos EnergyStrategy

  Background

  The company was repositioning itself after the SOCO International period and following controversy surrounding activity in Virunga.

  Action taken

  SOCO International plc changed its name to Pharos Energy plc.

  Aftermath

  The new identity accompanied a stated focus on Middle Eastern and Asian assets while the company retained its London listing.

  Source

• 2018

  Acquisition of El Fayum interestsM&A

  Background

  Pharos sought to strengthen its producing portfolio and expand its presence in Egypt.

  Action taken

  The company agreed to acquire Merlon Petroleum El Fayum Company and 100 percent of the El Fayum concession.

  Aftermath

  The acquisition completed in April 2019 and made Egypt one of the company’s principal operating markets.

  Source

• 2016

  Sale of Angola interestsM&A

  Background

  The group continued rationalising its African portfolio.

  Action taken

  The company sold its Angola interests to Quill Trading Corporation and WMLC Resources.

  Aftermath

  Angola was removed from the company’s operating portfolio.

  Reported transaction value. US$5 million (2016)

  Source

• 2014

  Suspension of Virunga explorationStrategy

  Background

  Exploration activity in Virunga National Park generated opposition from conservation groups and international stakeholders.

  Action taken

  The company committed to suspend further exploration and later ceased operations in the Democratic Republic of the Congo.

  Aftermath

  The DRC became a former operating area, and the company later moved toward a more concentrated Middle East and Asia strategy.

  Source

• 2010

  Sale of Thailand assetsM&A

  Background

  Following the start of Bualuang production, the company chose to dispose of its Thai interests.

  Action taken

  SOCO agreed to sell its Thailand assets to Salamander Energy.

  Aftermath

  The transaction removed Thailand from the company’s operating portfolio.

  Reported transaction value. US$105 million (2010)

  Source

• 2008

  Sale of Yemen operationsM&A

  Background

  SOCO reviewed its international upstream portfolio while continuing to develop production in other regions.

  Action taken

  The company agreed to sell its Yemen operations to Sinochem.

  Aftermath

  Yemen ceased to be part of the group’s operating portfolio.

  Reported transaction value. US$465 million (2008)

  Source

• 2005

  Sale of Mongolian assetsOther

  Background

  The company continued reducing or reshaping its geographically diverse exploration portfolio.

  Action taken

  SOCO sold its Mongolian assets to Daqing Oilfield Limited Company, a PetroChina subsidiary.

  Aftermath

  The disposal reduced the company’s exposure to Mongolia and supported portfolio concentration elsewhere.

  Source

1. 1Pharos Energyen.wikipedia.org
2. 2Pharos Energy corporate websitepharos.energy