Press Releases

Press Release
[New Delhi, Janruary 07, 2005]

A-1 Myanmar appraisal success brightens GAIL’s prospect

GAIL’s prospects of gas sourcing from Myanmar to Indian markets have brightened by the success of the first appraisal well of the Shwe gas field. The development enhances the possibility of commercial development of the gas field significantly. The consortium of GAIL, OVL, KoGas and Daewoo International has successfully drilled the first appraisal well in Block A-1 in offshore Myanmar.

The well penetrated two gas reservoirs with a total thickness of 93 meter, wherein, the main G5 sand was proved to be an extraordinary reservoir showing porosity of 28%, gas saturation of 81% and estimated permeability of about 500 to 2,000 millidarcies. As the results of the first appraisal well are very encouraging, the consortium is quite confident with the commercial success of Shwe gas field. The appraisal well was spud in November 2004 at the location 7.8 km away from the first exploratory well where the consortium discovered gas in January last year. The exploratory well had confirmed the presence of 4 to 6 tcf of gas reserves in Shwe gas field translating into availability of 20-22 mmscmd of gas over a period of 20-25 years.

The Government of Myanmar has given GAIL the status of the preferred buyer in respect of the gas produced from the A1 Block. The prognostigated gas reserves are of the order of 14 to 42 tcf in four prospects. The Government of Myanmar has also agreed to associate GAIL (India) Ltd and ONGC Videsh Ltd (OVL) in the exploration and production from A3 block in offshore Myanmar. The A3 block is adjacent to A1 Block and is considered to have a good potential for hydrocarbon finds. The block was originally awarded by the Government of Myanmar in February 2004 to Daewoo International Corporation, Korea. The Government of Myanmar and Daewoo have agreed to allow participation by the Indian consortium in the exploration of the A3 block.

More appraisal wells will be drilled from mid-January until June this year to estimate an accurate reserve and confirm commerciality of the Block A-1. The consortium will also drill additional exploratory and appraisal wells at the Shwe Phyu and Ngwe prospects from late January using additional other drilling rig to find more gas reserve in Block A-1.

GAIL is also studying various options to monetize this gas either through offshore and onshore pipeline routes or as LNG. The options being considered include a 500-600 km offshore pipeline across the Bay of Bengal as well as a re-gasification terminal at Haldia for receiving the LNG shipped from Myanmar and also an option of importing CNG by ship is being explored.