China confirms work begins on Myanmar gas pipeline

Vol 12, PW 9 (18 Sep 08) People & Policy

Any journey begins with the first step, to paraphrase the late Chinese supremo Mao Zedong, and the same applies to the 2380-km, $1bn natural gas pipeline from various gasfields including those in the offshore A1 and A3 blocks in Myanmar, where ONGC Videsh and GAIL, hold a combined 30% stake.

PETROWATCH learns China has begun survey work to finalise a pipeline route through insurgent-controlled parts of Myanmar to pump an estimated 170bn cubic metres of gas over three decades to southwest China. “A feasibility study for the pipeline is already completed and a preliminary survey is underway to finalise the route,â€‌ a senior Chinese diplomat told us last week, on the sidelines of the India visit of Chinese foreign minister Yang Jiechi, from September 7 to 11.

The diplomat, who asked not to be named, said a consortium of three Chinese oil and gas companies would finance the pipeline: Sinopec, CNPC and CNOOC. “Actual laying of the pipeline will begin in the middle of next year,â€‌ he said.

“You know our reputation for completing projects before schedule.â€‌ Indian lethargy in securing transit permission from Bangladesh helped Myanmar decide in June last year to sell all gas production from A1 and A3 to China National Petroleum Corporation, despite loud protests from Delhi.

But like the late Mao’s famed Long March, Chinese authorities pushing the pipeline project face difficulties of their own - insurgents fighting rule by the Myanmar military in the Arakan and Chin provinces, as well as Sagaing division. They fiercely oppose the pipeline and could sabotage the project.

Conscious of this, pipeline project chief General Thein Sein, who is also prime minister, has been holding a series of meetings over the last two months with Bai Enpei, the southwestern Yunnan region secretary of the Chinese Communist Party. “Meetings are also being held between the security services of both countries,â€‌ adds the diplomat, “to route the pipeline through areas with minimal or no separatist presence.