NEW DELHI: In a development of strategic importance, India was once again beaten by China to sign a 30-year mega deal to import natural gas from fields in Myanmar offshore where interestingly India’s oil companies have 25 per cent stake.
Highly placed sources said China’s State-run China National Petroleum Corp (CNPC) has entered into a gas sales agreement with South Korea’s Daewoo International for buying gas from the Shwe field in A-1 offshore block and the adjoining A-3 block. Daewoo is the operator in the two blocks with 51 per cent stake while India’s Oil and Natural Gas Corporation (ONGC) has 17 per cent and Gas Authority of India Limited (GAIL) 8.5 per cent. Korea Gas Corp has 8.5 per cent and Myanmar Oil and Gas Enterprise (MOGE), the remaining 15 per cent.
Sources said GAIL had offered a price of $5.01 per million British thermal unit to buy the entire gas from the offshore fields and pipe it to India through the North-Eastern States. But the military Junta in Myanmar preferred to do business with China, which will have to lay a longer pipeline to reach its South-Western Yunnan province. Myanmar would also be able to tap the pipeline running across its territory to meet its fuel needs once the gas starts flowing sometime in 2013.
Sources said that CNPC and MOGE planned to build oil and gas pipelines through Myanmar and into China’s South-Western Yunnan province. Myanmar had in 2004 selected GAIL as the preferred buyer of gas from A-1 and A-3 blocks. A memorandum of understanding (MoU) to this effect was signed between the two countries on March 9, 2006. But on August 9, 2006, Myanmar invited bids from prospective buyers such as India, China and Thailand for exporting gas. In October that year, the Myanmar government intimated that none of the bids met its expectations. Subsequently, it invited bids for the sale of 3.5 million tonnes of liquefied natural gas from the blocks. GAIL again submitted its bid. In February 2007, the Myanmar Government, in principle, made up its mind on the sale of gas from A-1 and A-3 blocks to China through the pipeline route, they said.
Source: The Hindu