Burma Business Wrap (January 16, 2012)
covering burma and southeast asia
Friday, August 23, 2019
Business

Burma Business Wrap (January 16, 2012)


By STEPHEN BLOOM Monday, January 16, 2012


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All in all, Burma this week awarded the rights to ten onshore oil and gas blocks to eight companies from countries including Thailand, Malaysia, Indonesia, Hong Kong, India, Russia and Switzerland.

Interestingly, Chinese companies showed little interest in the on-shore offer. China is already extracting oil and gas in 23 of Burma’s 47 inland blocks, and so it may feel that it has secured rights to what it has determined are the most potentially lucrative blocks and is happy to leave the remains to other regional players while Western sanctions remain in place. It’s also possible, however, that the dragon is sending a message to Burma that it remains displeased with the Myitsone slap in the face, and won’t now be used as a stalking horse to drive up the price on energy blocks for other competing bidders.

In addition, sources told Reuters that Burma will now reportedly offer nine offshore blocks, five of which are deepwater.

“The Ministry of Energy has asked for proposals. Some oil and gas companies have come for the data presentations. There has been a lot more interest in the deepwater blocks coming from the Japanese,” said one Reuters source.

Foreign Business Delegations Parade into Burma

Following on the heels of the Thai delegation, Japanese Trade Minister Yukio Edano led a group of leading business figures to Burma this week, including the president of Japan’s top refiner JX Nippon Oil and Energy.

Smaller Japanese companies, especially in textiles and fisheries, want to do business in Burma, and bigger firms are taking an interest, said Yoshihiro Araki, senior researcher at the Japan External Trade Organization, according to Reuters.

In addition, the Japan Bank of International Cooperation has been in talks with ITD on providing the funding for port and road development in Dawei, and Japan has been actively pushing for and providing funding for the development of a “Southern Corridor” transport route from Burma to Vietnamese ports.

“Other countries are rushing in,” said Araki. “Japanese businesses are thinking they cannot lose this race.”

While still blocked from investing in the country due to Western sanctions, even business representatives from the US are assembling at the starting line, if not edging over it, for the race into Burma. This week it was revealed that a group of key American executives would travel to the Southeast Asian nation in early February. It was initially announced that none other than Bill Gates would be among them, but his spokesperson later denied that this was the case.



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