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Myanmar to open more oil exploration blocks

Myanmar is to open even more oil exploration blocks to lure in further international investors to the area.

So far, the state has awarded 40 blocks to oil and gas giants including Total, Shell and Chevron, but this is only around half of what is available in the resource-rich nation, and - as such - further auctions are set to take place in 2015.

Initially, nine blocks look set to be auctioned off in the New Year, with around 15 being offered to international investors by the end of the year.

Great expectations

Expectations of discovering more oil and gas are high, according to Than Min, Director of the Planning Department at the Myanmar Oil and Gas Enterprise.

He added: "It will contribute a lot to Myanmar people. We need to manage revenues from these projects. Then our development programme will be oriented to people development."

As part of the plans, Myanmar's Energy Ministry has outlined plans to team up with a private company in order to offer oilfield services.

Slight concern

Some concern has been raised that this could put pressure on so-called smaller players, with Kyaw Kyaw Hlaing, Chairman of Myanmar Oil & Gas Services Society, saying all parties involved must be on "a level playing field".

"They should compete together with the other service companies. They shouldn't take advantage and tell the oil companies that you must give it to this joint venture company. This is the concern from the local service companies and service companies overseas, also," he explained.

In spite of concerns, the state is confident that these can be addressed and that the auctioning of the new blocks will reap dividends for the nation and the parties involved.

Rising interest

Many foreign investors who do not have operations or business transactions in Myanmar are keen to enter the oil and gas market as it continues to liberalise - something evidenced by the sector attracting the second largest foreign investments in Myanmar, amounting to over US $15 billion as of August 2014.

This contribution is equivalent to around 30 per cent of Myanmar's total foreign investments, and indicates that the nation has every intention of proceeding with its plan to open up the oil exploration blocks to lure in further international investors in the years ahead, beginning with the next round in the New Year.

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