China, India race after Myanmar's natural gas riches

AFP: 15 August, 2006

MANILA: China and India are racing to secure a lock on a newly discovered offshore             

natural gas field in Myanmar, believed to be one of the largest such finds in Southeast Asia, the reclusive nation's ambassador to the Philippines said.

The Arakan field, close to India and Bangladesh and estimated to contain "trillions of cubic feet (tens of trillions of cubic litres)," was discovered this year by a joint venture involving South Korea's Daewoo, an Indian firm and state-run Myanmar Oil and Gas Enterprises, ambassador Thaung Tun said.

He told the Foreign Correspondents Association here that the rapidly growing economies of its two giant neighbours, New Delhi and Beijing, are eyeing the field to fuel growth in India's planned eastern industrial centre as well as China's economically lagging interior western regions.

A gas pipeline to India "would have to go through Bangladesh and we're having trilateral negotiations to get a gas pipeline going," Thaung Tun added without giving details.

However, China appears to have a leg up on its regional rival.

The envoy said a state-run Chinese oil firm that he did not name signed a memorandum of agreement with Myanmar in February to build a "dual-purpose" pipeline from the Indian Ocean port of Sittwe to Yunnan province.

"They have started work" on the pipeline, he said without giving a timetable for completion, explaining that "major projects like this cannot be built in a day."

He said that aside from piping natural gas from Myanmar, the Chinese pipeline could also take in oil shipped from the Middle East.

Myanmar for the past five years has been supplying about 20 percent of the natural gas requirements of its eastern neighbour Thailand.

Aside from China and India, Thaung Tun said the Arakan field could also support a plan by the Association of Southeast Asian Nations (ASEAN) to build an ASEAN-wide natural gas pipeline.

"Exploration has confirmed that this is a major deposit, in the trillions of cubic feet," the envoy said. "This could contribute to the regional gas network."

ASEAN groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.