Thailand’s PTT Exploration & Production (PTTEP) has confirmed it will be taking over from TotalEnergies’ operation of the Yadana gas field in Myanmar, after the French major left due to increasingly militant junta activities.
In a statement, PTTEP wrote it would step in as Total’s successor “to ensure no interruption of natural gas supply and to reinforce long-term energy security especially in the current circumstances, where other forms of energy are not primary source for electricity generation”.
Energy groups including TotalEnergies, Chevron and Woodside all announced their retreat from operations in the region in January this year, after increased pressure from humanitarian groups for the companies to halt all activities that could channel money back into the junta. Myanmar has been thrown into turmoil since a military coup in 2021, and the junta’s escalated violence against civilians has led activists to call for a boycott on operations.
TotalEnergies’ decision to exit Yadana has been met with approval, however it appears the group’s choice to do so without financial compensation means that Myanma Oil and Gas Enterprise (MOGE) – a primary source of revenue for the junta – will gain a greater share of the field for free.
Under the PTTEP-TotalEnergies deal, the French company’s share of Yadana will be divided between the remaining joint venture partners with no commercial value. Currently, MOGE holds a 15% share in the field, a figure that is expected to rise to just over 21% after receiving a portion of Total’s stake, though this is not referenced in PTTEP’s statement on the matter.
The other shareholders, PTTEP and Chevron subsidiary Unocal Myanmar Offshore Company Limited, will hold 37% and 41%, respectively. Chevron’s own retreat from operations is underway, however it will reportedly be seeking to do so via a commercial transaction in order to avoid MOGE receiving a greater slice of the shares.
The transfer of operatorship to PTTEP is expected to be completed by 20 July 2022.
Yadana currently produces 770 million cubic feet per day (mmcf/d) of gas, with a portion of this used to meet half of Myanmar’s gas demand. Thailand also relies on the Yadana field for around 550 mmcf/d of gas to supply 12 power plants.