Clashes: plans for pipelines from Burma to China cause riots
Gail talks up Burma-China pipe
Indian state-run gas transporter Gail is exploring the possibility of laying a pipeline to China from Burma, where it has 10% stake in two blocks, company’s chairman BC Tirpathi said today.
The 890-kilometre pipeline is expected to cost $1.5 billion and Gail's decision to invest depends on issues such as return on investment and associate rights over the project, Reuters quoted Tripathi as telling reporters after a shareholder meeting.
"There is a proposal from Kogas and Daewoo (the other stakeholders) to lay a pipeline from west of Burma to east of China, but a final decision may take some time because we have to see return on investment also," said Tripathi.
Gail’s head of finance, RK Goel, said China Gas Holdings could also join the consortium.
"We have already taken approval from the Myanmar government and the existing consortium to permit our alliance to associate in the joint venture," Goel said.
The Daewoo-led consortium recently decided to go ahead with its 4 trillion won ($3.2 billion) A-1 and A-3 development off Burma that will export pipeline gas to neighbour China.
The decision means that China National Petroleum Corporation (CNPC) will start building a major gas pipeline as early as this month to initially deliver gas from the Shwe (Gold) field to cities in south-western China.
Daewoo and its partners will supply 500 million cubic feet of gas per day for 30 years from 2013 through the pipeline to China's border province of Yunnan.
The plans have met fierce opposition from local activists who argue that the Burmese people are facing severe shortages in energy and the resources belong to the people of Burma.
Violent clashes between Burma's ruling junta and Kokang ethnic armies near its border with China last week saw thousands of refugees fleeing to China's Yunnan province, and could prompt CNPC to delay construction of a transnational gas pipeline.
The violence that erupted in August in the north-eastern Shan state is near the site for CNPC's parallel oil and gas pipelines - the latter to deliver gas from Daewoo International's A-1 and A-3 project off Burma.
Beijing has urged Burma to resolve the conflict, which brought to an end a 20-year ceasefire between the Myanmar Nationalities Democratic Alliance - representing the Kokang - and government troops.
Partners in the project are operator Daewoo, India's Oil & Natural Gas Corporation, Gail, Kogas and Burma's national Myanmar Oil & Gas Enterprise.