The consortium plans to sell gas output from Myanmar's A-1/A-3 fields to China, a KOGAS official said.
KOGAS plans to spend $299 million and Daewoo would spend a separate 2.1 trillion won ($1.68 billion) for initial investment, the two companies said in separate statements.
(Reporting by Miyoung Kim; Editing by Jonathan Hopfner)
From Times Online
August 25, 2009
Daewoo to transport Burmese gas to China
A consortium of South Korean and Indian companies is to invest $5.6 billion (£3.4 billion) in producing natural gas in Burma for export by pipeline to China.
Led by Daewoo International, the South Korean conglomerate, the consortium has agreed to supply China National Petroleum Corporation with the output of a giant Burmese gasfield for 30 years, a deal that underlines the increasing influence and importance of China to the economy of Burma, the impoverished and isolated state on its southwestern border.
As well as Daewoo, which owns 51 per cent, the consortium includes ONGC, India's state oil company, and GAIL, India's state gas company, as well as Korea Gas and MOGE, the Burmese state oil and gas company.
The gas will come from the giant Shwe field in the Bay of Bengal, offshore of Arakan state in Western Burma.
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Discovered in 2003, the Shwe and Shwe Phyu gasfields are thought to be among the largest in South-East Asia, together representing between 3 trillion and 6 trillion cubic feet of gas, according to Daewoo figures.
The resource is of huge value to the Burmese military government and could be worth $40 billion at estimated gas sale prices.
For China, the energy assets of its neighbour are highly attractive. China's consumption of gas is increasing as the country seeks to resolve myriad energy problems, including a domestic shortage of oil and gas and a need to reduce the air pollution caused by the burning of coal in power stations as well as carbon emissions.
The consortium is waiting for the green light from the Burmese Government, although the military junta controls MOGE and its 15 per cent stake in the enterprise.
The project is opposed by human rights groups and others who fear that development of the offshore gas and the construction of a pipeline will not only bolster the regime but infringe the rights of minority groups in Arakan state.
Burma's gas resource has been a bone of contention among opponents of the military regime.
Campaigners previously latched on to the Yadana and Yetagun projects, two gasfields in the Andaman Sea developed respectively by Total, the French oil company, and Premier Oil, a British exploration company.
The Yetagun and Yadana gas is exported to Thailand, and the construction of a pipeline through virgin rain forest and disputed tribal areas roused huge controversy.
Despite concerted efforts to appease the protesters, Premier eventually sold its interest to Petronas, the Malaysian state oil company.
In July CNPC offered the Daewoo consortium a 49.9 per cent stake in am pipeline that the Chinese will build linking the Shew fields in the Bay of Bengal with China.
The 870-kilometre pipe, costing almost $2 billion, will bring gas to the Burmese border with Yunnan province.
China is in relentless pursuit of energy deals and has courted its neighbours assiduously including Central Asia energy giants, such as Turkmenistan and Kazakhstan as well as liquefied natural gas exports from Australia.
Last week PetroChina and ExxonMobil agreed a record $41 billion contract to export LNG from the North West Shelf of Australia. ( ရဲရင္႔ )
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