Ministry of Electricity and Energy will launch a major new bidding round for oil and gas exploration this year1 Jun 2020
Myanmar will launch a major new bidding round for oil and gas exploration this year, according to a senior energy ministry official.
“It is almost certain that it [the bidding round] will be launched during this year,” said the Ministry of Electricity and Energy deputy permanent secretary U Htay Aung on May 26.
The government is revising the Production Sharing Contracts, he added.
“After amending [the terms and conditions], open blocks will be launched for international bidding,” officials said.
This will be the first international bidding round under Daw Aung San Suu Kyi’s government.
The ministry pledged to open 33 new blocks for foreign bidding in the first quarter of last year but that has been delayed because the authorities had wanted to draft a petroleum law to regulate the round.
It is unclear whether the ministry will enact the legislation before the bidding. If so, the timeline would be tight given the need to consult stakeholders and revise the draft law.
Major oil and gas producers complained that the initial draft law - if not amended - could keep investors away. Others said the draft legislation as it stands does not address the many state-owned enterprise governance and contract disclosure issues.
The last bidding round, under U Thein Sein’s government, succeeded without such a law.
Analysts warn that since oil prices will likely stay below $40 for the foreseeable future, and are currently heading towards $20 because of a build-up in stocks, Myanmar may need to offer its blocks at a discount.
The oil and gas sector is of huge importance to Myanmar’s fiscal health. In 2017-18, natural gas shipments accounted for US$3.1 billion, or roughly half of the country’s total export revenues.
(The Myanmar Times: https://www.mmtimes.com/news/moee-go-ahead-oil-and-gas-bidding-round-year.html )