Economy

Markets

Industries

Insights

Reports

Events

China, Myanmar, Daewoo consortium sign gas pacts in Myanmar

(Xinhua)
Updated: 2008-06-21 10:27

The China National Petroleum Corporation (CNPC), Myanmar and a consortium, led by the Daewoo International Group Corporation, signed a memorandum of understanding (MOU) in Nay Pyi Taw Friday on sale and transport of natural gas from the offshore blocks A-1 and A-3.

The Daewoo consortium comprises South Korea Gas Corporation and India's ONGC Videsh Ltd and Gas Authority of India Ltd (GAIL).

The three parties also inked an agreement on launching joint feasibility study on onshore natural gas pipeline involving six companies of China, Myanmar South Korea and India, and an agreement contract on entrusting the planning department of the CNPC by the six companies to implement the feasibility study.

The signing ceremony was witnessed by Myanmar Foreign Minister U Nyan Win, Chinese Ambassador Guan Mu, South Korean Ambassador Park Key-Chong and other Myanmar ministers. They expressed support and concern over the project representing the four countries.

The signing of the MOU signified the overall launching of cooperation in natural gas project between Myanmar and the four countries, officials said.

Natural gas deposits were found at block A-1 (Shwe field and Shwephyu field) and block A-3 (Mya field) in the Rakhine offshore area in January 2004 and April 2005 respectively, explored by the consortium of oil companies led by Daewoo with 60 percent-stake. Other companies go to South Korea Gas Corporation (10 percent), ONGC Videsh Ltd of India (20 percent) and GAIL (10 percent).

The Shwe field holds a gas reserve of 4 to 6 trillion cubic- feet (TCF) or 113.2 to 170 billion cubic-meters (BCM), while the Shwephyu 5 TCF and the Mya 2 TCF with a combined proven reserve of 5.7 to 10 TCF of gas being estimated by experts.

Myanmar has abundance of natural gas resources especially in the offshore areas. With three main large offshore oil and gas fields and 19 onshore ones, Myanmar has proven recoverable reserve of 18.01 TCF (510 BCM) out of 89.72 TCF (2.54 TCM) 's estimated reserve of offshore and onshore gas, experts said, adding that the country is also estimated to have 3.2 billion barrels of recoverable crude oil reserve.

According to the Central Statistical Organization, in the fiscal year 2006-07, Myanmar produced 7.71 million barrels of crude oil and 13.039 BCM of gas. Gas export during the year went to 13.03 BCM, gaining $2.03 billion.

The latest figures indicate that in the first half of 2007-08, the country's crude oil production amounted to 3.86 million barrels, while its gas output 6.74 BCM. Gas export was registered at 9.17 BCM during the period, obtaining $1.53 billion.

More statistics reveal that foreign investment in Myanmar's oil and gas sector had reached $3.24 billion in 85 projects as of the end of 2007 since the country opened to such investment in late 1988, standing the second in the country's foreign investment sectorally after electric power.  

Currently, 13 foreign oil companies, mainly from Australia, Britain, Canada, China, Indonesia, India, South Korea, Malaysia, Thailand and Russia, are involved in oil and gas  projects in Myanmar, according to official sources.