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Now an Indo-Myanmar gas pipeline

November 29, 2004 14:31 IST

Petroleum Minister Mani Shankar Aiyar will visit Dhaka and Yangon in January to explore the possibility of laying a natural gas pipeline from Myanmar to India via Bangladesh.

"I will be going to Bangladesh on January 8-10 and from there visit Yangon. Obviously, on my agenda will be the Myanmar-India gas pipeline," he told reporters in New Delhi.

The pipeline is one of the several options being considered by India to bring gas reserves at Shwe field in Block A-1 in offshore Myanmar, as well as volumes that are expected to be discovered in its adjacent block A-3.

In both the blocks, ONGC Videsh Ltd has 20 per cent stake and GAIL (India) 10 per cent. South Korea's Daewoo is the operator of the two blocks.

Bangladesh will earn about $125 million annually as transit fee for the pipeline, that would run through Arakan (Rakhine) state in Myanmar to the Indian states of Mizoram and Tripura before crossing Bangladesh to Kolkata.

Sources said Dhaka had agreed in-principle for the export pipeline proposal and a tripartite deal could be sealed as early as January 2005.

Dhaka, however, wants the pipeline to be laid along Bangladesh's existing roads and highways and that the project be jointly managed by it and India. It also wants New Delhi to agree to allow it to use the pipeline to export gas to India or import it from Myanmar.

India would build the $1 billion 290-km gas trunkline while Bangladesh's state-owned Gas Transmission Company would be responsible for managing the stretch in its country.

A $3 billion liquefied natural gas project to bring A-1 and A-3 gas was also under evaluation, sources said.

GAIL has commissioned Italian contractor Snamprogetti to conduct a feasibility study for the LNG project.

An appraisal campaign recently started at Shwe, which has estimated recoverable reserves of between 4 trillion and 6 trillion cubic feet of gas. Reserve potential at the A-1 block is put at up to 24 Tcf.

First gas from A-1 block is expected in 2009, sources said.

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