Thu 27 Mar 2014
Filed under: Business / Trade,News
Long-awaited news on which foreign energy companies have been given rights to explore offshore Myanmar reads like a who’s who of the oil and gas industry, but with a very noticeable exception.
As expected, two major Western companies which had remained in Myanmar through tough times when international sanctions against new investment were in force—Chevron Corp. and Total were given exploration blocks, in shallow and deep water respectively.
There is very little data on how rich Myanmar’s waters might prove to be, although earlier finds have been developed, allowing natural gas to be piped to Thailand and China.
Myanmar’s ministry of energy said Wednesday that 20 blocks out of 30 initially offered to investors had been awarded, but didn’t say which bidders hadn’t succeeded.
Others getting the right to prospect in waters long-closed to foreign investment due to sanctions include Royal Dutch Shell PLC, Norway’s Statoil, the UK’s BG Grou PLC and Italy’s Eni.
From the U.S., ConocoPhillips joined Chevron, while two India companies also got blocks, as did Australia’s Woodside Petroleum.
So who is missing?
Think China–famed for massive overseas energy investments by its deep-pocketed state-owned companies PetroChina, China Petroleum & Chemical Corp., or Sinopec, and Cnooc Ltd.
Between them they’ve laid out tens of billions of dollars to buy oil and gas rights in countries as diverse as Brazil, Canada, Kazakhstan and Mozambique in the past couple of years.
These overseas-investment behemoths are not completely absent from Myanmar—but their projects there mostly predate 2010 when the country started introducing political reforms after decades of military rule and the generals in charge made an abrupt about-face away from China, their only major ally.
That shift was followed by a slump in Chinese investment in Myanmar, and some major Chinese investments going on hold, including the $3.6 billion Myitsone dam project in the north of the country. In April last year, Sinopec sold rights in an onshore Myanmar oil block it had held since 2004, to a Taiwanese company.
One big Chinese project is still underway, although running behind schedule. PetroChina’s parent China National Petroleum Corp is close to completing a cross-Myanmar crude-oil pipeline to pump imported oil into southwestern China—its parallel gas pipeline sending offshore Myanmar gas went into service last year.