The two latest production sharing contracts for onshore oil and gas includes the biggest share yet for the local partner.
Myanmar company Young Investment Group will have a 25 percent stake in onshore blocks C-1 and H, with state-owned Myanma Oil and Gas Enterprise and Young’s Canadian partners Pacific Hunt Energy Corporation controlling the rest.
The Ministry of Energy has required that winners of last year’s onshore oil and gas tender partner with a local firm, though most local partners have a stake from 1 to 20pc.
The Pacific Hunt Energy-led venture will spent at least US$100 million over the next three years of exploration, said U Thiha Aung, chair of Young Investment Group.
C-1 is located in western Myanmar near the border with India, while block H is southeast of Nay Pyi Taw and northeast of Yangon.
Pacific Hunt Energy chair Henry Aldorf said it has been a long two and a half year process, including winning the rights to the two blocks in a large tender last year.
The firm will begin environmental and social surveys soon.
“We look forward to the successful exploration of our newly licensed acrerage,” said Mr Aldrof.
U Kyaw Kyaw Hlaing, president of the Myanmar Oil and Gas Services Society, said the 25pc stake is quite large for local industry.
“Most local firms have a stake in an oil and gas venture between 1 to 20pc,” he said. “The business is quite risky, but we want development of all local companies.”
U Thiha Aung said the country has a vast amount of natural resources, and it will benefit Myanmar to see significant investment in oil and gas.
“It will be better to develop our natural resources with high-end technology from the west instead of relying on imports,” he said.
MOGE will receive $8.1 million as signature bonus for signing the production sharing contracts when the two companies move to the exploration stage. The production sharing contracts for the 16 awarded blocks have been signed only beginning in August, after several months’ delay.