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May 20, 2019

Continuous oil well tests will contribute to economic growth

  • By Kyaw Kyaw Hlaing (SMART)
An oil well in Chauk oil field in Magway Region . Photo: Phoe Khwar

During the monthly press conference held by the Ministry of Energy and Electricity’s (MOEE) on 17 January 2019, U Nyan Tun, deputy managing director for Myanmar Oil and Gas Enterprise (MOGE), said that a well test will be done in Myaing Township, Magway Region to examine the hydrocarbon properties therein.
It will be the first time a well test is carried out in the area. “Drilling will start on January 26,” U Nyan Tun said.
The Myaing deep hole well No.1 is located at the south of the Myaing Anticline in the Chindwin sedimentary basin. Exploration will be conducted to determine the presence of oil or gas at the middle of the anticline.
“According to expert analysis, there is a high possibility that either oil or gas can be found. If oil or gas is found, we will proceed to production,” MOEE deputy permanent secretary U Htay Aung explained.
It is estimated that the oil well may produce about 3 million cubic feet of natural gas per day. “According to the geology contours we have received, it is estimated that the well could contain around 82 billion cubic feet of recoverable reserves,” the MOEE said in a statement.
If the well test is successful, plans to drill another 11 oil wells will be carried out. Locals will be compensated for any farmlands affected as a result of the drilling, said U Nyan Tun.
No decision has been made on where and how the natural gas, if discovered and produced, will be utilized. “We will decide depending on the amount and type of gas. It is too early to say where this gas will be used,” U Nyan Tun said.
In generating electricity for consumption in the country, we need more natural gas.
In 2017-2018, the country generated a total of (19,193) Gigawatt hours and that (42) per cent came from the utilization of gas turbines. A total of only (39) per cent of households in the country is getting electricity from the national grid. The Union of Myanmar holds (11) millions households across the country, and that (6 point 7) millions households are not looped in the national grid of the country.
The Ministry of Energy and Electricity has laid down the project in providing electricity to (99) per cent of households in the country by 2030, which eventually needs (16,600) Megawatt (MW) to operate with heavy machineries and modern devices to generate the required electricity.
In the year 2030, the gas turbines with the capacity of (8,919) Megawatt would be functioning in the country. As of today, Myanmar is utilizing gas turbines in generating electricity with the daily consumption of (440) million cubic feet gas. Only (40) million cubic feet gas is available from onshore resources, and that (400) million cubic feet gas has been acquired from the offshore sources. The cost of onshore gas is much lesser than the cost of offshore gas.
Looking back into the pages of Myanma oil and gas factsheets, the Revolutionary Council government had nationalized the BOC, IBP and BBPC owned by the foreign firms in 1962, and that it had purchased (49) per cent owned by the BOC and the IBP at the value of (62.5) million Kyats.
On 1 January 1963, the government had established the state owned oil industry. Beginning for that time, the exploration of oil and gas has been initiated by national experts and professionals, and eventually the following explorations have been successfully created and utilized.
Oil and natural gas land resources stand as per following list (one).


1. Myanaung 1964 (Ayeyawaddy Region)
2. Pyay 1965 (Bago Region)
3. Shwepyithar 1967 (Ayeyawaddy Region)
4. Pyalo 1969 (Magway Region)
5. Mann 1970 (Magway Region)
6. Letpando 1974 (Magway Region)
7. Peppi 1976 (Magway Region)
8. Htaukshabin 1978 (Magway Region)
9. Htantabin 1980 (Ayeyawaddy Region)
10. Tatma 1981 (Mandalay Region)
11. Kanni 1985 (Magway Region)
12. Apyauk 1991 (Ayeyawaddy Region)
13. Kyaukkwet 1995 (Magway Region)
14. Nyaungdon 1999 (Ayeyawaddy Region)
15. Thagyitaung/Sabe 2001 (Magway Region)
16. Maubin (South) 2007 (Ayeyawaddy Region)
In the past, natural gas extracted from Myanaung and Shwepyithar were being utilized in the functioning of the turbines in the electricity generation in Myanaung.
Now, the turbines in Myanaung are generating electricity with the use of gas extracted from Yadana Offshore gas fields. Similarly, in the past, the natural gas extracted from onshore Aphyauk areas were used at Ahlon and Hlawga natural gas fired power plants. Now, gas is being acquired from Yadanamyay Offshore oil and gas fields in the use of generators. While using the gas being purchased from the onshore areas, the cost was moderate and low.
When we look at the list (one) for (16) year’s time, total of (8) natural oil and gas fields have been explored and identified from 1964 to 1980. The Mann oil field that was explored in 1970 has been producing (25,000) oil barrels a day in 1979-80, and stands out as the most profuse oil field of the country.
Until now, the Mann Oil Field is still producing (1,188) oil barrels per day. In (38) years, only (8) natural oil and gas fields had been found such as from 1980 to 2018. From 1964 to 1980 in (16) years time, total of (8) natural gas and oil fields had been explored.
However, during (38) years period from 1980 to 2018, it was only (8) natural oil and gas fields being explored, and that was the case study to be reviewed over the list (Two).
The list under referral showed the oil drilling machineries being purchased by Myanma Old and Gas Enterprise. In 2007, that is the year after 1983, only four oil drilling machines were being purchased. The capacity and strength of the drilling machines being acquired in 2007 were not functioning in top gear compared to the previous machines being bought in 1971 and 1983.
After 2007, there was no newly found oil and gas field in the country. Only when we could dig more new areas, then there are possibilities in finding oil and gas fields. According to the data and information across the world, it has the chance to find three oil fields out of ten exploration fields, indicating the fact that we need to dig more and much more.
During 1983 to 2003, the Myanma Oil and Gas Enterprise had deployed over (30) drilling machines and explored nearly (50) fields each year, however, currently with (16) drilling machines, the country is concentrating only on (20) fields each year.
When we could explore the onshore oil and gas exploration, it would be more advantages and beneficial to the national economy.
Dig fast, dig hard for more resources for the country. Each year, we have been incurring loss for about (400) billion Kyats in electricity generation and distribution. Each year for the exploration of oil stands out at (60) billion Kyats, and therefore, we could find out what are the things to be changed and altered as fast as possible.
If we could produce more oil and gas from the onshore areas, then the gas being sought from the offshore area and the LNG purchased from abroad could be reduced. When we could reduce the purchase of such oil and gas into the country, we could save foreign currency of the nation.
With the intent to produce the oil and gas from the onshore areas, the following suggestions are being submitted for consideration in pragmatic approach in the fastest possible time.
1. Myanma Oil and Gas Enterprise should be reorganized as a corporate. [Note: It is not to be handed over to the private ownership. It is only the administrative paradigm to transform similar to the PETRONAS and the PTT.
2. The potential areas such as that of the Pyalo, the Htantabin, and the Ayeyawaddy Delta area are to be deployed in the approach with 3D Seismic in exploring the old and gas. The news plans must be modified and seek more budget for better implementation.
3. The most potential and possible areas must be given priority for exploration and drilling. The news plans must be modified and seek more budget for better implementation.
4. More new drilling machines are to be purchased.
5. The companies that are interested to explore in the onshore oil and gas areas must be given more special concession, and sign for sharing in the exploration business.

The writer of this article holds the view that we are at an opportune time to drill continuous well tests so that we can unearth rich resources that will contribute to our economic growth.

Translated by UMT (Ahlon)

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