Myanmar signs energy concession contracts with Indian firm
From Kyodo News Service/Burmanet
May 9, 2005
link to this article.
Myanmar has signed energy contracts with Essar Oil Ltd., allowing the Indian company to explore for oil and natural gas at offshore and onshore blocks in western Rakhine State, official media reported Monday.
Hsan Lwin, managing director of the state-owned Myanma Oil and Gas Enterprise (MOGE), and Essar Oil Managing Director A. N. Sinha signed production-sharing contracts Saturday for the exploration in the offshore block A-2 (off the western Rakhine coast) and the onshore block L (in the Rakhine coastal region), the New Light of Myanmar reported.
Energy Minister Brig. Gen. Lun Thi, Minister for Social Welfare, Relief and Resettlement Maj. Gen. Sein Htwa, Attorney General Aye Maung, Indian Ambassador to Myanmar R. K. Bhatia and Essar Oil President A. N. Sinha witnessed the signing ceremony at the Sedona Hotel in Yangon.
The report did not further elaborate on the contracts.
Essar is the first foreign company to sign an onshore oil and gas production agreement with Myanmar since the government announced in March that all onshore blocks would be reserved for MOGE in the future.
It was not immediately known how Essar won the contract for the onshore block despite that ban.
The last time Myanmar awarded a production-sharing contract for onshore exploration was in January this year to a Chinese-Singaporean consortium.
According to MOGE, the offshore block A-2 won by Essar, covering more than 1,336 square kilometers, is adjoining in the west to block A-1, which holds a commercially viable natural gas reserve of up to 11 trillion cubic feet.
The block A-1 has been undertaken by South Korea's Daewoo International Corp. in partnership with three other foreign oil companies since 2000.
The Daewoo holds a 60 percent stake in the A-1, while (South) Korea Gas Corp. 10 percent, India's ONGC Videsh Ltd. 20 percent and Gas Authority of India Ltd. (GAIL) 10 percent.
Myanmar has signed dozens of oil and gas exploration and production contracts with foreign companies, mostly for offshore gas operations, since the country began to allow foreign investment in 1988.
Myanmar has 46 onshore oil and gas fields, and 25 offshore fields, according to Myanma Oil and Gas Enterprise.
About 40 percent of the country's export earnings come from natural gas exports to Thailand.