China National Petroleum Corporation (CNPC) announced on Friday that the Myanmar-China gas pipeline is ready for trials after three years of construction while the crude oil pipeline is now 80 percent complete.
The Myanmar-China oil and gas pipelines
run parallel from the coastal township of Kyaukphyu through Magway
Region, Mandalay Region, and Shan State before entering China's Yunnan
providence through the border town of Ruili. The gas pipeline is 793 km
long and the oil pipeline is 771 km long.
The gas pipeline will carry a capacity
of 5.2 billion cubic feet of natural gas per year during the initial
period and up to 12 billion cubic meters in later years. Six process
stations will be also be built along the pipeline.
Myanmar will transport 2 million tonnes
of crude oil and 2 billion cubic meters of natural gas per year from the
Shwe project to China. The pipelines will operate for 30 years with the
government receiving US$13.81 million per year in royalties, according
to prior statements from South-East Asia Crude Oil Pipeline Company
Limited (SEAOP) and South-East Asia Gas Pipeline Company Limited
(SEAGP).
The Ministry of Energy has signed a
production sharing contract with South Korea's Daewoo International
Cooperation to explore oil and natural gas in Block A-1 and Block A-3 in
the Rakhine off-shore region.
Gas and oil found from these blocks will
be used for the Myanmar-China gas pipeline project, which is a joint
venture between China's National Petroleum Corporation and the
state-owned Myanmar Oil and Gas Enterprise, with the former holding 50.9
percent stake in the project.
However, Myanmar will only receive
US$6.095 million annually for the right of passage and an oil transit
fee of US$1 per tonne of export crude for 22 million tonnes a year,
according to Minister of Energy Than Htay.
source: Eleven Myanmar
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