We saw some big news this week on new petroleum exploration. In a place many observers thought would never be open to modern E&P firms.
That's the southeast Asian nation of Myanmar, formerly known as Burma.
Authoritarian politics here made the country a no-go for most foreign investment during the last 50 years. Up until a few years ago, when the government finally began a shift toward democracy.
That change has now paid off for oil and gas firms. With Myanmar announcing the results of its first-ever modern licensing round for the high-potential offshore here.
The government granted 10 shallow-water blocks along with 10 deepwater licenses. Concluding a bidding process that began almost a year ago.
Expect some big discoveries to come out of these projects. With Myanmar having seen little foreign investment, it's one of the few truly frontier petroleum basins outside of difficult operating environments like the Arctic or the Caspian. And given the geological similarities to proven petroleum provinces like Thailand and India, there are almost certainly big pools to be found.
In fact, recent work by some early-in explorers has already demonstrated the big upside. This month, Thailand petro-major PTTEP said it is about to begin producing 300 million cubic feet per day of gas from its offshore Zawtika field in the northern Andaman Sea. The company having been granted an earlier license for work here, in direct negotiations with the government.
Some of that gas will feed local demand. But nearly two-thirds of the output will be exported to high-value markets in Thailand. Giving a big financial push for gas production here.
Other big E&Ps seem to also be encouraged by all this upside. With this week's bid round including awards to major firms like BG, Chevron, Shell, Statoil, and Eni. The complete list of winners is here.
There are also a handful of junior firms getting a foot in the door. Such as Australian-listed ROC Oil and Tap Oil. For such firms, the discovery potential here is very material.
It will take some time for exploration to advance. But this is a space to watch for some big finds.
Here's to re-writing history,
By Dave Forest