GAIL-OVL Set to Participate in Myanmar Offshore A3 Block

The Government of Myanmar has agreed to associate with the Indian consortium consisting of GAIL (India) Ltd. and ONGC Videsh Ltd (OVL) in the exploration and production from the A3 block in offshore Myanmar. This block, adjacent to gas bearing block A1, is considered to have a high potential for hydrocarbon finds.

The A3 block was originally awarded by the Government of Myanmar in February 2004 to Daewoo International Corporation, Korea. The Government of Myanmar and Daewoo have agreed to allow participation by the Indian consortium in the exploration of the A3 block. Tripartite discussions to finalise the above arrangement have been held between the parties this month in Yangoon. The Indian consortium was lead by Mr Proshanto Banerjee, CMD GAIL and Mr R S Butola, MD OVL; and the Korean side was lead by Mr T Y Lee, Chairman Daewoo International. The extent of participation by the Indian consortium and other commercial terms is under discussion and the consortium is hopeful of a sizeable level of equity participation. A team is being constituted to negotiate the details.

The Indian consortium also held discussions with HE Brig. General Lun Thi, Minister of Energy, Myanmar. The Minister welcomed participation by the Indian side in the new block and expected that the gas produced from the field will find a market in India. The Government of Myanmar had already nominated GAIL as the preferred buyer in respect of the gas produced from the A1 block and GAIL is currently studying various options to monetize this gas either through offshore and onshore pipeline routes or as LNG. HE Brig. General Lun Thi had visited New Delhi earlier this year and held bilateral discussions with the Indian Minister of Petroleum and Natural Gas.