http://www.atimes.com/atimes/South_Asia/KD03Df03.html
China secures Myanmar energy route
By Sudha Ramachandran
BANGALORE - China and Myanmar have signed an agreement for the construction of fuel pipelines that will transport Middle East and African crude oil from Myanmar's Arakan coast to China's southwestern Yunnan province - short-circuiting the long sea voyage past Singapore - while also drawing from Myanmar's own gas reserves.
Under the March 27 agreement, a gas pipeline will tap into Myanmar's reserves at the Shwe gas fields, and an oil pipeline will carry Middle East and African crude that is currently transported in tankers through the Malacca Strait to China.
Construction of the US$1.5 billion oil pipeline and the $1 billion gas pipeline will begin soon and is expected to be completed by 2013. China's largest oil and gas company, the China National Petroleum Corporation (CNPC), holds 50.9% stake in the project, with the rest owned by the Myanmar Oil and Gas Enterprise (MOGE).
The roughly 2,000 kilometers of pipeline will cut through the heart of Myanmar, beginning near Kyaukphyu on the Arakan coast and running through Mandalay, Lashio and Muse before crossing into China at the border town of Ruili. The pipelines will terminate at Kunming in Yunnan province. A gas collection terminal and a port for oil tankers will be constructed on an island near Kyaukphyu. The entire cost of constructing the pipelines will be borne by China.
Myanmar has the world's 10th-largest natural gas reserves, estimated at over 90 trillion cubic feet (tcf) in 19 onshore and three major offshore fields. According to Myanmar officials, the country's daily gas production will almost double to 2.235 billion cubic feet by 2015 from the current 1.215 billion cubic feet.
The Shwe reserves in the gas field off the Arakan coast have attracted considerable attention following the discovery of deposits at block A-1 (Shwe field and Shwephyu field) in January 2004 and at block A-3 (Mya field) in April 2005. It has been estimated that the Shwe field holds a gas reserve of 4tcf to 6 tcf and the Shwephyu, and the Mya fields have a combined proven reserve of 5.7tcf to 10 tcf. The finds have triggered fierce competition between India, China, South Korea, Thailand Japan and Singapore.
Thanks to its decades of proximity to Myanmar's military rulers, China has been successful in swinging decisions in Myanmar's energy sector in its favor. That it is a veto-holding member of the United Nations Security Council and in a position to prevent resolutions critical of the junta from being passed at the top UN meeting place has helped increase China's presence and profile in Myanmar's oil and gas sector.
Stakes held by Chinese companies in 16 oil and gas blocks make China the largest foreign investor in Myanmar's energy sector, although it entered only as recently as 2001.
In December 2008, China finalized an agreement with a consortium led by South Korea's Daewoo International and including MOGE, India's Oil & Natural Gas Corporation, GAIL India (Ltd.) and Korea Gas Corporation, under which it was assured of 30-year supply of gas from the A1 and A-3 blocks beginning 2013. The pipeline from Kyaukphyu will carry this gas to Yunnan.
Besides opening up a new source of gas in Myanmar for China, the pipeline project will strengthen China's bonds with Myanmar's military rulers and increase its already considerable influence over its neighbor. No less significant, the link will enhance China's energy security, helping to reduce China's excessive dependence on the Malacca Strait.
The 900km-long strait, which connects the Indian and Pacific Oceans, is one of the world's busiest shipping channels. Around 65,0000 vessels pass through it every year, carrying a quarter of the world's traded goods. Roughly a quarter of all oil transported by tankers passes through the strait, mainly from the Gulf and Africa to China, Japan and South Korea.
The Malacca Strait is crucial for China's trade and energy security. At present, roughly 80% of China's annual imports of 1.5 billion barrels of oil pass through the narrow seaway, which separates Malaysia from Indonesia.
Over the past few years, Chinese analysts and leaders have been describing the strait, as a strategic vulnerability, drawing attention to the consequences for China if this shipping channel were to fall into the hands of "hostile powers" or pirates or terrorists. What if the US were to block China's access to the strait in the event of a China-Taiwan conflict?
In November 2003, Chinese President Hu Jintao articulated this fear when he declared that "certain major powers" were bent on controlling the strait. Analysts have been discussing the country's "Malacca dilemma" since then and exploring options to overcome it. One proposal, partially undertaken, is to develop a port and pipeline terminal at Gwadar, in southwest Pakistan, from where Middle East fuel could also be pumped to western China.
From 2013, Chinese oil tankers from the Middle East and Africa will be able to cross the Bay of Bengal to dock at Myanmar's Sittwe and Kyaukphyu ports from where their cargo will be transported through pipelines to Yunnan. The transport time of fuel that bypasses the Malacca Strait in this way will be cut by a week.
The pipelines, however, will mean an increased Chinese presence and activity in the immediate neighborhood of India. The pipelines might have eased Beijing's anxieties somewhat, but they have added to New Delhi's.
---------------------------------------------------------
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China secures Myanmar energy route
By Sudha Ramachandran
BANGALORE - China and Myanmar have signed an agreement for the construction of fuel pipelines that will transport Middle East and African crude oil from Myanmar's Arakan coast to China's southwestern Yunnan province - short-circuiting the long sea voyage past Singapore - while also drawing from Myanmar's own gas reserves.
Under the March 27 agreement, a gas pipeline will tap into Myanmar's reserves at the Shwe gas fields, and an oil pipeline will carry Middle East and African crude that is currently transported in tankers through the Malacca Strait to China.
Construction of the US$1.5 billion oil pipeline and the $1 billion gas pipeline will begin soon and is expected to be completed by 2013. China's largest oil and gas company, the China National Petroleum Corporation (CNPC), holds 50.9% stake in the project, with the rest owned by the Myanmar Oil and Gas Enterprise (MOGE).
The roughly 2,000 kilometers of pipeline will cut through the heart of Myanmar, beginning near Kyaukphyu on the Arakan coast and running through Mandalay, Lashio and Muse before crossing into China at the border town of Ruili. The pipelines will terminate at Kunming in Yunnan province. A gas collection terminal and a port for oil tankers will be constructed on an island near Kyaukphyu. The entire cost of constructing the pipelines will be borne by China.
Myanmar has the world's 10th-largest natural gas reserves, estimated at over 90 trillion cubic feet (tcf) in 19 onshore and three major offshore fields. According to Myanmar officials, the country's daily gas production will almost double to 2.235 billion cubic feet by 2015 from the current 1.215 billion cubic feet.
The Shwe reserves in the gas field off the Arakan coast have attracted considerable attention following the discovery of deposits at block A-1 (Shwe field and Shwephyu field) in January 2004 and at block A-3 (Mya field) in April 2005. It has been estimated that the Shwe field holds a gas reserve of 4tcf to 6 tcf and the Shwephyu, and the Mya fields have a combined proven reserve of 5.7tcf to 10 tcf. The finds have triggered fierce competition between India, China, South Korea, Thailand Japan and Singapore.
Thanks to its decades of proximity to Myanmar's military rulers, China has been successful in swinging decisions in Myanmar's energy sector in its favor. That it is a veto-holding member of the United Nations Security Council and in a position to prevent resolutions critical of the junta from being passed at the top UN meeting place has helped increase China's presence and profile in Myanmar's oil and gas sector.
Stakes held by Chinese companies in 16 oil and gas blocks make China the largest foreign investor in Myanmar's energy sector, although it entered only as recently as 2001.
In December 2008, China finalized an agreement with a consortium led by South Korea's Daewoo International and including MOGE, India's Oil & Natural Gas Corporation, GAIL India (Ltd.) and Korea Gas Corporation, under which it was assured of 30-year supply of gas from the A1 and A-3 blocks beginning 2013. The pipeline from Kyaukphyu will carry this gas to Yunnan.
Besides opening up a new source of gas in Myanmar for China, the pipeline project will strengthen China's bonds with Myanmar's military rulers and increase its already considerable influence over its neighbor. No less significant, the link will enhance China's energy security, helping to reduce China's excessive dependence on the Malacca Strait.
The 900km-long strait, which connects the Indian and Pacific Oceans, is one of the world's busiest shipping channels. Around 65,0000 vessels pass through it every year, carrying a quarter of the world's traded goods. Roughly a quarter of all oil transported by tankers passes through the strait, mainly from the Gulf and Africa to China, Japan and South Korea.
The Malacca Strait is crucial for China's trade and energy security. At present, roughly 80% of China's annual imports of 1.5 billion barrels of oil pass through the narrow seaway, which separates Malaysia from Indonesia.
Over the past few years, Chinese analysts and leaders have been describing the strait, as a strategic vulnerability, drawing attention to the consequences for China if this shipping channel were to fall into the hands of "hostile powers" or pirates or terrorists. What if the US were to block China's access to the strait in the event of a China-Taiwan conflict?
In November 2003, Chinese President Hu Jintao articulated this fear when he declared that "certain major powers" were bent on controlling the strait. Analysts have been discussing the country's "Malacca dilemma" since then and exploring options to overcome it. One proposal, partially undertaken, is to develop a port and pipeline terminal at Gwadar, in southwest Pakistan, from where Middle East fuel could also be pumped to western China.
From 2013, Chinese oil tankers from the Middle East and Africa will be able to cross the Bay of Bengal to dock at Myanmar's Sittwe and Kyaukphyu ports from where their cargo will be transported through pipelines to Yunnan. The transport time of fuel that bypasses the Malacca Strait in this way will be cut by a week.
The pipelines, however, will mean an increased Chinese presence and activity in the immediate neighborhood of India. The pipelines might have eased Beijing's anxieties somewhat, but they have added to New Delhi's.
---------------------------------------------------------
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1. Rise in suicides across Asia feared amid recession
2. Singapore March PMI up, but manufacturing contracts
3. OECD names and shames tax havens
4. SIA launches 15-day massive global sale to fight for business
5. Record Number of Runners to Compete in Singapore’s Night Ultramarathon
6. Indonesia - the regional role model towards democracy
7. Reward Organ Donors
8. Touring Singapore's Gastronomical Heritage
New videos added:
1. Peter Schiff Vlog Report - 2 Apr 2009
2. Testing democracy in Indonesia
3. G20 live bloggers share their views - April 02 09
4. Australia cuts intake of foreign workers
.
