PTTEP to become operator of Myanmar gas field: Update

Market: Natural gas
16/03/22

Adds comments from TotalEnergies

Thailand's state-controlled oil firm PTTEP will take over as operator of Myanmar's (Burma) largest gas field Yadana from TotalEnergies, which earlier this year announced a decision to withdraw from the offshore project.

The field supplies around half of the power needs of Myanmar's commercial capital Yangon. It produces 770mn ft³/d (7.95bn m³/yr) of gas, of which around 70pc is exported to Thailand, where it is sold to PTTEP's parent company PTT, and 30pc goes to state-owned Myanmar Oil and Gas (Moge) for domestic use.

"After the decision of TotalEnergies to withdraw from [the] Yadana project, PTTEP has thoroughly considered to take a step as the successor operator in order to ensure… no interruption of natural gas supply and to reinforce long-term energy security, especially in the current circumstances, where other forms of energy are not [a] primary source for electricity generation," PTTEP said.

PTTEP will also take over as the operator of gas transportation firm Moattama Gas Transportation (MGTC), TotalEnergies said today. MGTC operates a 400km pipeline that carries gas from Yadana to the Myanmar-Thailand border.

"In addition, PTTEP has expressed its willingness to take on all staff currently employed by the TotalEnergies affiliate in Myanmar," TotalEnergies added.

TotalEnergies, Chevron and Australian independent Woodside Petroleum are preparing to exit critical gas projects in Myanmar because of the worsening situation in the country since a February 2021 military coup.

TotalEnergies has operated the Yadana field with a 31.24pc stake since 1992, along with Chevron with 28.26pc, PTTEP with 25.5pc and Moge with 15pc. The shareholders of MGTC are the same as the partners in Yadana with the same proportions.

TotalEnergies and PTTEP expect the Yadana and MGTC operatorship transfer to be completed on 20 July.

"After the effective date of TotalEnergies' withdrawal, PTTEPI [PTTEP International] will hold [a] 37.0842pc participating interest [in Yadana]," PTTEP said. Chevron subsidiary Unocal Myanmar Offshore will hold the remaining 41.1016pc.

"Chevron intends to accept its share of Total's interest in so far as it supports our objectives of achieving a safe and orderly transition," a Chevron spokesperson told Argus. "Our preference is to follow an orderly and planned transition that will lead to an exit through a transaction."

This approach will provide greater control over incoming joint-venture parties, the spokesperson added.

Chevron does not have an exit date yet, saying that its exit plan is independent of TotalEnergies' withdrawal and "our timelines for an exit will differ."

"An exit date will depend on several factors, including the progress of confidential commercial discussions, transfer of operatorship and the well-being of our employees," the Chevron spokesperson said. "One of our key objectives through the exit process is the continuity of natural gas supply to provide for the needs of the people of Myanmar and Thailand."

By Reena Nathan

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