PTT Exploration and Production (PTTEP), Thailand’s only publicly-listed upstream petroleum company, is set to spend US$3.3 billion in Myanmar over the next five years.
President and chief executive Tevin Vongvanich said 20% of $16 billion capital expenditure between now and 2018 will be allocated to Myanmar to support operations and long-term growth.
Currently, PTTEP is investing in seven oil and gas exploration and production projects in Myanmar and is also an operator of Zawtika, Myanmar M3, Myanmar M11, Myanmar PSC G & EP 2 and Myanmar MD-7 and MD-8 projects.
Under the five-year capital expenditure, the company has set 2020 production aspiration to a more realistic target of 600,000 of barrels of oil equivalent per day.
Southeast Asia has the largest portion with 74% of the five-year expenditure, with Thailand at 52% while Myanmar ranks second at 20% or around $3.3 billion.
For the Middle East and Africa, PTTEP will allocate 14% of the capital, followed by North America and Australasia at 11% and 1%, respectively.
It also plans to expand investments through mergers and acquisitions with the focus on producing or near-term producing assets in order to increase production and proved reserves.
In 2014, PTTEP expects to increase its global sales volume to 325 boed, an 11% increase from 2013’s 293 boed.
This year, the Zawtika project in the Gulf of Martaban, the first gas project that PTTEP operates in the Myanmar, will come on stream to secure both Myanmar and Thailand a reliable petroleum supply.
In the first phase, Zawtika will initially produce 300 million cubic feet per day (MMSCFD) and offer significant benefits for both Myanmar and Thailand. Both countries will share its gas production to meet their growing energy appetites and to support other development in their respective countries.
PTTEP also holds a 25% stake in the Yadana gas field and 19% in Yetagun. The two offshore natural gas blocks are being developed by Total of France and Petronas of Malaysia, respectively, in partnership with the government’s Myanmar Oil and Gas Enterprise.
''We consider Myanmar as our second home. PTTEP plans to drill more appraisal wells in Zawtika and carry out exploration activities in Myanmar M3 to provide natural gas for the domestic market. The company will also continue its exploration activities in Myanmar M11, Myanmar PSC G & EP 2 and Myanmar MD-7 and MD-8 projects for possible future development,'' Mr Tevin said.
When the Zawtika project starts to supply gas to Thailand via a new pipeline, Myanmar will become the biggest gas supplier to Thailand.
The Myanmar government tender to award new exploration contracts for 11 shallow-water and 19 deep-water offshore blocks in November, and the winners are expected to be announced at the end of next month.
Mr Tevin said PTTEP was bidding for one new block, but said that he could not go into details about the bid.
Shares of PTTEP closed yesterday on the SET at 151.50 baht, down 50 satang, in trade worth 484 million baht.