Thirty-three years after the fall of Saigon, Vietnam is never far from the American psyche, as witnessed during the presidential campaign. In a frisson of nostalgia for what might have been, U.S. oil companies can only note with regret the announcement last week by the Kremlin that in the wake of talks between the Russian and Vietnamese presidents, their governments have concluded an agreement on further cooperation on geological exploration and hydrocarbon production by their Vietsovpetro joint venture.
For those with a sense of history and irony, in 1975, several months before the fall of Saigon, U.S. Ambassador Graham Martin, commenting on Mobil’s and Pecten’s recent Dua-1X and BH-1X oil well discoveries in the South China Sea off Vietnam, opined that if the South Vietnamese government could hang on, oil revenues from the new finds could benefit from the surge in oil prices in the wake of the 1973 Arab oil embargo to finance the war.
By John Daly
Western geological exploration of South Vietnam’s offshore South Continental Shelf began in the late 1960s. Mobil and Shell subsidiary Pecten drilled offshore in the Nam Con Son and Cuu Long basins and found the largest oil fields in the South China Sea. The prize that they uncovered was significant, with Nam Con Son estimated to contain 20 percent and Cuu Long 30 percent of Vietnam’s total hydrocarbon resources. But the course of the war meant that changing military and political realities would shortly overwhelm both the South Vietnamese government and the dreams of the Western energy concerns.
Saigon fell on April 30, and Martin evacuated on the last helicopter to leave the embassy. Vietnam’s new government immediately canceled all foreign concessions granted by the now defunct South Vietnamese government, leaving Mobil with lost millions in investment and a bunch of now useless geological data.