23-06-08 South Korea's Daewoo International said its Burma gas consortium had agreed to sell natural gas to China National Petroleum Corporation (CNPC).
Daewoo, which operates Burma's A-1 and A-3 natural gas fields, said in a regulatory filing its consortium had signed a memorandum of understanding with CNPC over the sale and transportation of natural gas from the project. Daewoo has a 51 % stake in the fields, followed by India's Oil & Natural Gas Corporation (ONGC) (17 %) and Gas Authority of India Limited (GAIL) (8.5 %), South Korea's Korea Gas (8.5 %) and Myanmar Oil & Gas Enterprise with 15 %.

The deal comes after China surprised markets by raising its nationwide fuel prices by up to 18 % in its biggest one-off increase to date.
Few western companies will invest in Burma because of its poor human rights record and continued detention of Nobel Peace Prize laureate Aung San Suu Kyi, which has led to a broad range of US and European sanctions. China, typically wary of supporting or imposing sanctions and one of Burma's few diplomatic allies, has shown no qualms about investing in its neighbour, eager for its natural gas, oil, minerals and timber to feed a booming economy.

Daewoo said last year it had picked China as a preferred bidder for natural gas from a project in Burma, putting it at the front of a queue that also includes India and Thailand. Burmese officials have also said the gas will go to China. Beijing, says it is considering building gas and oil pipelines into its south-western Yunnan province. This would improve access to its neighbour's rich resources, eyed by many energy-hungry nations across Asia.
Burma has at least 90 tcf of gas reserves and 3.2 bn barrels of recoverable crude reserves in 19 onshore and three major offshore fields. Altogether, 25 offshore blocks are under exploration, 12 of them in the Gulf of Martaban, 6 off the Tanintharyi coast and 7 off the Rakhine coast.

CNPC controls listed PetroChina, which has come under pressure from activist shareholders because of its parent's investments in Sudan.
The supply of gas from the project will be adjusted every quarter based on international energy prices, Daewoo said.