Feb 26, 2015

Shell Myanmar Energy to spend US$1.2 bn on offshore oil exploration

Shell Myanmar Energy is poised to spend US$1.2 billion on offshore oil and gas exploration and provide $61 million as a signature bonus to state-run Myanmar Oil and Gas Enterprise (MOGE) , the Energy Ministry has announced. The company has the green light to run two sites (AD-9 and AD-11) in Rakhine State and one (MD-5) in Taninthayi Region. A contract on profit-sharing was signed with the Energy Ministry on February 5. Shell Myanmar Energy and Tokyo-based Mitsui Oil Exploration will conduct the exploration and undertake production under terms of the contract. It is estimated the three sites should take two years of study and another six for exploration. The social and environmental impact assessments are also included in this foreign investment joint venture. "Offering $61 million as signature bonus is a record since the amount has never been more than $6-7 million before," said Kyaw Kyaw Hlaing, the chairperson of Myanmar Oil and Gas Services Society, a non-profit that aids in development of the Myanmar oil and gas industry. Eight out of 18 onshore blocks were permitted to six foreign companies through joint-venture agreements with local entrepreneurs in 2011. Another 18 onshore blocks were tendered in January 2013, and 16 of them allotted to 10 foreign companies through joint venture agreements. Source: Eleven Weekly Media