Piped gas from Myanmar is far more realistic and practical than expecting the Iranian gas to travel through Pakistan to reach India

Although the question of upward revision of gas prices has been going on for more than a year, and is in line with the contractual obligation, and duly announced by the Oil Minister, it now appears that the revised price cannot be brought into effect from 1^st April due to the ensuing elections, as per a ruling made by the Election Commission.

As law abiding citizens, we maintain status quo and await the new government to be formally announced, who will take the appropriate steps in this direction.

The exact price revision is still not certain and, of course, there is no guarantee that, upon the increase, the production and supply of gas will automatically increase to meet our national needs. Far from it. An upward revision would, according to the producers, make it economical and viable for them to explore and extract the gas from depths of the ocean to serve the country.

All the main producers, apart from expanding their exploration and expansion activities in the country, are also keenly investing outside so as to obtain the best results that their investments can buy. Even ONGC, which is a government owned enterprise, has clearly stated that the upward revision would make it worthwhile for them to continue their exploration; at a lower rate, it would be uneconomical to invest such huge sums.

Myanmar, originally and popularly known in the past as Burma, has been the home for oil production for long. Most of the gas it produces goes to China, whom we may recall, laid a pipeline to carry this gas. China is well entrenched in Myanmar, not only in the oil industry but in many other areas as well.

An auction launched by Myanmar in April 2013, according to the Energy Minister, initially received interest from some 68 firms, though, in the end, 30 firm bids were received, covering 30 offshore blocks; and ten blocks each were in shallow and deep waters, which have now been awarded. It would be some more time before the final 10 blocks would be awarded, and no time limit has been set for this purpose, presumably to see the progress that is being made by the awardees.

Myanmar government will receive from these successful bidders a signature bonus of $226.10 million, once the exploration of the blocks begins.

Among the conditions, the winners of the shallow water blocks need to take a local partner but those in the deep water blocks are waived of this ruling, in as much as high costs are involved besides technical competency needed in such work. In any case, bidders will have to enter into a production sharing agreement with the state-owned Myanmar Oil and Gas Enterprise (MOGE).

Reliance won the M17 and M 18 shallow water blocks in Moattama basin in water depths upto 3,000 ft and these two blocks together encompass an area of 27,600 sq km.

Oil India Ltd, Mercator Petroleum Ltd and Oilmax Energy Private Ltd have jointly been awarded three blocks; Italy's ENI Myanmar BV got two blocks while BG Asia Pacific Pte Ltd and Woodside Energy Pte Ltd jointly won four blocks.

International giants like Chevron, Shell and Total also were awarded blocks for exploration. All these successful awardees will have to invest, at least $3 billion in the exploration programme, apart from signing the production sharing contract. This investment will entitle them to a 30 year license to explore and produce oil and gas off the Myanmar shore. The other details of pricing etc. will be known only at a later date when full details are made public.

This is a giant step for India in its march for reviving our age-old relations with Myanmar. It is essential that greater and regular contacts are established with those in authority in that country and we must explore the avenues for persuading them to lay a gas pipeline to ensure supply into India in the eastern states, as a start.

If anything, immediate steps should be taken for the Commerce Minister and Ministry of Oil to lead a joint team to investigate the possibilities for such a pipe line. Piped gas from Myanmar is far more realistic and practical than expecting the Iranian gas to travel through Pakistan to reach India. IPI is a pipe dream, while MPI - Myanmar Pipeline to India would be a distinct and workable possibility.

(AK Ramdas has worked with the Engineering Export Promotion Council of the ministry of commerce. He was also associated with various committees of the Council. His international career took him to places like Beirut, Kuwait and Dubai at a time when these were small trading outposts; and later to the US.)