Thai PTTEP Set to Take Over Myanmar's Biggest Offshore Gas Field as Oil Majors Exit

Florence Tan and Chayut Setboonsarng
Wednesday, January 26, 2022

Thailand's state oil and gas explorer looks set to take over Myanmar's biggest gas field, as TotalEnergies and Chevron Corp exit in the wake of last year's coup in the Southeast Asian state, analysts say.

A move by PTT Exploration and Production Pcl (PTTEP) to become operator of Yadana field, in which it already has a 25.5% stake, would keep vital gas supplies flowing to Thailand and Myanmar, and could safeguard revenues for Myanmar's government amid tighter U.S. and other sanctions.

France's TotalEnergies and U.S. firm Chevron said on Friday they were leaving, citing the worsening humanitarian situation following the coup.

The French and U.S. firms were part of a group operating the Yadana gas project off Myanmar's southwest coast and the Moattama Gas Transportation Company (MGTC) that runs a pipeline carrying gas from the field to Myanmar's border with Thailand.

"PTTEP appears the more likely candidate to take over as operator of Yadana," said Kittithat Promthaveepong, Bangkok-based consultant at the Lantau Group.

PTTEP would have an 85% stake in Yadana if it took all the shares held by TotalEnergies and Chevron.

PTTEP already operates Myanmar's smaller Zawtika field, in which it has an 80% stake and Myanmar's state energy firm Myanma Oil and Gas Enterprise (MOGE) holds 20%.



PTTEP said on Friday it was "carefully considering" its next steps regarding Yadana and how to maintain energy supplies for Thailand and Myanmar. PTTEP declined to comment further on Monday.

MOGE did not immediately respond to a request for comment.

TotalEnergies said on Friday that PTTEP would be a "natural" choice for its Myanmar assets and said it was in contact with the Thai firm. Chevron declined to comment.

Equity holders usually have the first right to decide if they want to take over stakes from their partners.

Rystad Energy analyst Readul Islam also said PTTEP was the most likely candidate to take over Yadana and said, if it went ahead, PTTEP would operate more than half Myanmar's gas supply.

Yadana produced 770 million cubic feet per day (mmscfd) of gas in 2021, with about 570 mmscfd of that supplied to Thailand and the rest used to generate Myanmar's electricity.

Yadana accounts for 10%-15% of Thailand's gas demand and is vital for Thailand's energy security as production at the biggest Thai field Erawan tumbled in 2021.

But looming sanctions on the oil and gas industry could drive more international firms out of Myanmar, leaving regional players with historical ties such as PTTEP to continue, said Saloni Kapoor, a research analyst at Wood Mackenzie.

(Reporting by Florence Tan in Singapore and Chayut Setboonsarng in Bangkok; Editing by Edmund Blair)

Categories: Energy Industry News Activity Production Asia

Related Stories

Centrica and Thailand’s PTT Ink Long-Term LNG Supply Deal

Japanese Oil and Gas Firm Enters Two Blocks off Malaysia

Yinson Production Closes $1B Investment to Drive Further Growth

Petronas-Eni Upstream Joint Venture to Take Up to Two Years to Set Up

Wood JV Gets EPC Job for Shell off Brunei

Fugro Expands Geotechnical Testing Capabilities in Indonesia

CNOOC Starts Production at Offshore Field in South China Sea

Indonesia's Medco Starts Production at Natuna Sea Fields

Petrovietnam, Petronas Extend PSC for Offshore Block

Valeura Wraps Up Infill Drilling Campaign in Gulf of Thailand

Current News

Centrica and Thailand’s PTT Ink Long-Term LNG Supply Deal

Petrovietnam, Partners Sign PSC for Block Off Vietnam

Japan Protests China’s New Oil and Gas Construction Activities in East China Sea

CNOOC Signs Hydrocarbons Exploration and Production Deal with Kazakhstan

Thailand's PTT to Buy LNG from Glenfarne's Alaska LNG Project

Woodside and Jera Agree LNG Cargoes Supply for Japan’s Winter Period

Petronas Expands Suriname Portfolio with Deepwater Block Acquisition

Japanese Oil and Gas Firm Enters Two Blocks off Malaysia

Yinson Production, “K” LINE Target Europe's CCS with FSIU and LCO2 Solutions

Woodside Agrees Long-Term LNG Supply with Petronas Unit

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com