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September 23, 2019

Myanmar’s Offshore Oil Fields

  • By Retired Petroleum Expert
  • An offshore project of PTTEP. Photo:  Supplied

The article will bring the message about energy sector of the country, with high expectation to increase electricity consumption of the country in next five years and to share knowledge of energy sector.
Myanmar already has four offshore natural gas fields at present. The total production capacity from three projects in Muttama/Martaban offshore—Yadana, Yetagon and Zawtika— is 1,280 million cubic feet per day, while Shwe natural gas project in Rakhine offshore is producing 500 million cubic feet each day. The figures have shown that although Myanmar is producing excess amount of natural gas, the joint-venture contracts have limited to 430 million cubic feet per day for domestic consumption. Another restraint is the long processing period in offshore natural gas exploration industry. As Myanmar saying goes; ‘As soon as a well is dug, we cannot get clear water’, oil and gas cannot be extracted from their reservoirs immediately after they were found.

Discovery of natural gas reservoir
Myanma Oil Corporation, for example, discovered a natural gas reservoir in 1982. After the Total E& P company signed an agreement in 1992, the preliminary extractions were started. The French oil company could begin extraction at Yadana project in 1998, six years after the tests. Moreover, Yetagon natural gas field was found in 1992, and the extraction was started about eight years later, while the Daewoo International Corporation Myanmar E&P could produce its first gas from the Shwe gas field in 2013 that is nine years after it initiated the project.

Technological challenges
These natural gas fields are located at deep sea areas not more than 150-meter depth. The recently found A-6 gas field is situated at ultra-deep water with more than 2,000 meter, and that the project will need more time and investments than its precursors projects. It encountered bigger technological challenges.

Yadana offshore natural gas production project in Mottama Gulf. Photo:  MNA

Real enjoyments
An announcement was made on the 68th Independence Day on 4th January 2016 that a natural gas reservoir was found at the preliminary oil field Shwe Yee Tun (1) in Block A-6 at western offshore of Myanmar. The similar announcement for commercial production was also issued for Pyithit (1) and Shwe Yee Tun (2) oil fields in the block. These announcements brought real enjoyment for Myanmar citizens. The first commercial discovery of oil and natural gas in southern part of western offshore of Myanmar has become a potential source for generating more electricity that is a major driving force for the economic development of the country.

Return of projects
The history of oil and gas exploration in western offshore of Myanmar was very interesting amid many challenges. The MPRL E & P Pte Ltd. invested 100 per cent capital for A-6, and signed a Production Sharing Contract for Offshore Block A-6 on January 18, 2007 with the Myanma Oil & Gas Enterprise (MOGE). It also conducted all the exploration processes, including geological surveys along Rakhine coastal areas and offshore seismic measurements. During this period, a Malaysia-based oil company gave up their surveys at the A-5 Block that is next to A-6 Block, and a Korean oil company also withdrew their investments in A-7 Block. These two foreign companies retuned the projects to the MOGE.

Conclusions of experts
However, the preliminary oil field Pyithar (1) was successfully dug at A-6 Block in March 2012, and discovered the natural gas. It is located southern part of western Ayeyawady offshore. Some geologists remarked that this discovery has shown Paleo Ayeyarwady System, with the deposits from the eastern Myanmar to the western offshore, that is different from Bengal Fan System, with the deposits from north to south in western Ayeyawady offshore.

Struggles from difficulties
Based on the data received from Pyi Thar Discovery and 2D seismic measurements, the A-6 Block was found to be located in a geological feature of huge natural gas reservoir. However, the MPRL company faced with difficulties in capital and technology for exploration works in the ultra-deep project. Therefore, the Australia-based Woodside company and the French Total E& P joined the project. These companies explored ‘Padauk’ 3D Seismic in 2013, ‘Shwe Yee Tun (1)’ in 2015, ‘Thazin’ 3D Seismic in 2016 respectively. They also dug Pyithit (1) in 2017 and Shwe Yee Tun (2) in 2018 for the preliminary tests. These companies held a press conference to announce that they could definitely calculate the volume of natural gas reservoirs at these oil fields.

First ultra-deep-water extraction
The A-6 Block is recorded as the first ultra-deep-water project for Myanmar as it is located at the sea depth of 2,500 meter. As there are not more than 16 ultra-deep-water projects across the world, the A-6 Block is a significant project in the region. The project will need a considerable amount of capital investment and human resources to complete it in time amid technological and operational challenges. In this joint-venture project, the MPRL will take up the role of operator, the Woodside as the technical operator for exploration- appraisal phase, and the Total E &P as a joint operator for development phase.

Supports for future development
These companies have announced in the press conference that the natural gas from A-6 Block will be used for both the domestic consumption and the export. Therefore, the A-6 Block will become the fifth offshore natural gas field after seven years when Shwe Natural Gas Field was discovered in 2014. And, it is hopeful that the new project will be very supportive for the development of the country in the future.

(Translated by Aung Khin)

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