There are no immediate plans to hold another bidding round for the oil and gas blocks in Myanmar, a senior official from the Ministry of Electricity and Energy (MOEE) told The Myanmar Times.
“No plan has been made for a new bidding round. There isn’t any plan under arrangement on the management level,” he said.
Bidding rounds for onshore and offshore blocks were made in 2012 and 2013 and exploration periods have just started in those blocks, he continued.
It has gone through a long process before the signing. There were various negotiations to resolve disagreements among companies under the single Production Sharing Contract (PSC). Thus the contract was signed only in early 2015.
PSCs were signed in 2014 and 2015, thus, relinquished blocks, continued blocks and discovery blocks can only be known in 2018 or 2019 or 2020 after exploratory and drilling activities, he said.
“The exploration period lasts at least five years. They [the companies] can relinquish the block within those five years. They can extend the period. If you add five or six years to 2015, it will be 2020 or 2021.
“Depending on the results of the exploration period, some firms may give up the block. If a discovery is made, the term can be extended, and they can continue drilling and production work.
“Therefore, during a short period, let’s say this year, there is no plan for another bidding round,” he added.
Only two of the 36 firms who were awarded PSCs failed to sign their contracts due to financial problems, the official said.
According to tender regulations, contracts which have failed to materialise have to be cancelled. However, those companies can still take part in a future bidding round.
Several international companies are working on those 36 blocks together with Myanmar firms.
The activities of those firms are monitored closely by the MOEE and it is unlikely that any further bidding round can happen at this time, the senior official said.
These companies have started study periods and exploratory works which will take at least five years.
A total of six years – one year for the study period and five years for exploration – is allowed for shallow-water offshore blocks, while deep-water offshore blocks are allowed a total of seven years to conduct their study and exploration period.
Source: The Myanmar Times