Vietnamese companies to explore oil and gas in Myanmar offshore area

Vietnamese companies to explore oil and gas in Myanmar offshore area
+ - 10:41, October 04, 2008
Two Vietnamese oil companies have reached a production sharing contract with Myanmar to explore oil and gas in the country's offshore area, the official newspaper New Light of Myanmar reported Saturday.

Under the contract signed in Nay Pyi Taw between the Petrovietnam Exploration Production Corporation Ltd and the Joint Venture Vietsovpetro of Vietnam and Eden Group Co Ltd of Myanmar, and the state-run Myanmar Oil and Gas Enterprise, such exploration on mutually beneficial basis will be undertaken by the three parties at Block M-2 in Myanmar's Mottama offshore area, the report said.


It is the first engagement of Vietnamese companies in Myanmar's oil and gas sector and the move came more than a year after the two countries initiated a memorandum of understanding on strategic cooperation in oil and gas during Vietnamese Prime Minister NguyenTan Dung's visit to Myanmar in August 2007.

Myanmar has abundance of natural gas resources in the offshore areas. With three large offshore oil and gas fields and 19 onshore ones, Myanmar has a recoverable reserve of 18.012 trillion cubic-feet (TCF) or 510 billion cubic-meters (BCM) out of 89.722 TCF or 2.54 trillion cubic-meters (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.

Statistics reveal that foreign investment in Myanmar's oil and gas sector had reached 3.243 billion dollars 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.

In 2007, foreign investment in the oil and gas sector more than tripled to 474.3 million U.S. dollars compared with 2006, accounting for 90 percent of the total during the year which stood505.02 million, according to the Ministry of National Planning and Economic Development.

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.

Statistics show that natural gas topped Myanmar's exports in 2007-08 with 2.594 billion dollars, up 27.7 percent from 2006-07's2.03 billion dollars, representing 42.9 percent of the total exports during the year.