Reliance Industries and Myanmar Sign Product Sharing Contract for Two Offshore Oil Blocks
Published By : 01 Apr 2015 | Published By : QYRESEARCH
Reliance Industries signed a deal with two Myanmar-based offshore oil and gas exploration blocks. The contract is essentially made to enter a foreign territory as the regulator frame at home is getting extremely difficult. A spokesman from Reliance stated that Myanma Oil & Gas Enterprise (MOGE), a government-run organization signed the deal with RIL. This is a contract to share product at two of the offshore blocks, namely M17 and M18.
Mukesh Ambani, owner of RIL won the two blocks at the Myanmar Offshore Block Bidding Round in 2013. RIL will have a participating interest of 96%, while United National Resources Development Services Co. Ltd. (UNRD) will hold the remainder stake. The latter is a Myanmar-based company. The offshore blocks are located in Tanintharyi basin, Myanmar. The depth of the water is 3000 feet and the area occupied by both the blocks measures up to 27,600 square kilometers.
RIL’s move is in tandem with its plan to expand overseas by making grand investments in international oil and gas destinations. This contract will allow the Indian company to gain excellent organizational expertise that will help them to add and generate value to their E&P segment.
The enterprises in oil-to-telecom sectors in Myanmar are trying to grow their upstream businesses by working with other nations. Previously, deals on such lines have been made with countries such as Iraq and Venezuela. Though Myanmar offers nearly the same kind of contract for production sharing it additionally permits recovery of costs prior to sharing spoils. This definitely makes Myanmar a lucrative choice for RIL.