Transocean International’s semi-submersible drilling rig the Actinia. Last autumn, the Actinia was contracted to drill in Burmese waters.
Nineteen Malaysian companies and Burmese businessmen will discuss investment opportunities on Tuesday at the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI) office in Rangoon.
In mid-July, foreign energy companies were invited to bid for permits for exploratory rights for oil and natural gas on 18 inland blocks along the Irrawaddy River. A total of 52 companies including the 19 Malaysian companies applied for permits through their embassies.
Some of the blocks are offshore blocks. The ministry did not disclose the exact number. Half of the companies’ proposals were rejected, the ministry said.
“Tomorrow local businessmen will explain the investments, the laws and other things the companies want to know. If they decide to invest in these blocks, local businessmen will agree to partnership with them,” said Sein Win Hlaing, a central executive UMFCCI committee member.
On November 2, during former Malaysian Prime Minister Dr. Mahathir Mohamad’s visit to Burma, Malaysia signed four memorandum of understanding including investments in palm oil and tourism, another UMFCCI official said. The former Malaysian Prime Minister was invited by UMFCCI.
There are 47 oil and natural gas production blocks in inland Burma. China, which is extracting oil and gas in 23 of the 47 inland blocks, is the largest investor; Malaysia is the second largest.
If a company finds a productive field, it must then apply for a production permit granted by the ministry to extract oil and natural gas.
“After the agreement, in a case where the companies find productive fields, the government and the companies will need to negotiate to determine how much in profits must be given to the government and the amount of a cash award,” said another UMFCCI official.
The Ministry of Energy said that to promote the oil and natural gas sectors, it cooperates with companies from Russia, China, India, Singapore, Malaysia and South Korea on oil and natural gas projects.
There is only one Burmese oil company, Myanmar Petroleum Resources Limited, which is owned by Michael Moe Myint. The Htoo Company owned by Tay Za and Nay Aung, who is the son of former Industry No. 1 Minister Aung Thaung, are shareholders in foreign oil and gas companies, according to sources close to the Ministry of Energy.
Currently, Burma’s inland blocks are producing more than 9,300 crude oil barrels a day and more than 100 million cubic feet of natural gas a day. Meanwhile, the Yadana and Yetagun offshore natural gas blocks are producing more than 1 billion cubic feet of natural gas a day.
According statements by the Ministry of Energy, there are a total of 0.46 trillion cubic feet of natural gas in the inland area in Burma and 17 trillion cubic feet in offshore blocks.
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