Saturday,Dec 09,2006
GAIL acquires 30 per cent in Myanmar block http://www.business-standard.com/common/storypage.php?autono=267422&leftnm=1&subLeft=0&chkFlg=
BS Reporter / New Delhi December 09, 2006
GAIL India, in consortium with Singapore's Silver Wave Energy, has signed a deal with Myanmar to drill for oil and gas in the the country's west coast.
According to the deal, GAIL will own 30 per cent of the assets, while Silver Wave will be the operator of the block with 70 per cent stake. GAIL did not disclose the financial details of the deal for the new A-7 block.
"Data collection work for establishing the potential of the A-7 block will begin soon. Exploration will start in a year's time. We hope to begin production 4 to 5 years after that," a company release said. The A-7 block is located adjacent to the A-1 and A-3 blocks in which GAIL holds 10 per cent stake.
The A-1 and A-3 blocks are primarily gas blocks. Gaffney, Kline and Associates has estimated that the two blocks together have reserves of 5.7 to 10 trillion cubic feet of gas.
With GAIL picking up stake in the new block, the chances of importing gas from Myanmar to India will receive a boost.
GAIL has already been nominated as the preferred buyer by the Myanmar government for gas from the A-1 block.
Talks regarding the proposed pipeline to transport the much-needed gas have been hanging in the balance for some time now, with the government still undecided on the route the pipeline would take.
In 2005-06, India had invested around $30.6 million in Myanmar's oil and gas sector.
GAIL now holds participating interest in 17 exploration blocks at different locations in the world. Seven of these blocks are on land and 10 are offshore.
Thirteen of the 17 blocks are located in India in the basins of Mahanadi, Bengal, Gujarat-Saurashtra, Mumbai, Cambay, Assam-Akaran and Cauvery. The company also has stake in Block 56 in Oman.
Business Standard Ltd. Copyright & Disclaimer