The Ministry of Energy said that the gas was encountered at a depth of 116 metres as locals drilled a well intended to supply water for a health care centre.
Ministry officials quickly went to Hnauk San village, as it was feared that the gas, which was spurting nine metres high on 13 December, could ignite.
It is not uncommon for gas or oil to be discovered onshore Myanmar when water wells are being sunk, a local source said.