South Korean steel giant POSCO's 68.15 percent-owned trading house affiliate Daewoo International plans to start developing gas resources at Myanmmar's A1 and A3 offshore blocks as early as May 2013, within the scope of a major gas project to be implemented in the country.
A group of officials from South Korea's Ministry of Knowledge Economy visited Myanmar at the end of December to attend the Korea-Myanmar collaboration committee for natural resource exploration. During the visit, the two parties agreed to strengthen their ties to explore and commercialize the gas resources in the offshore blocks together.
The Myanmar gas project, which is backed by the two countries' governments, is one of Daewoo's key business projects a POSCO release said, adding that in addition to Daewoo (51 percent), India's National Natural Gas Clearinghouse (17 percent), Myanmar Oil and Gas Enterprise (15 percent), Korea Gas Corporation (8.5 percent) and India's Oil and Natural Gas Corporation (8.5 percent) are also participating in the project as shareholders.
The gas resources will be sold to CNUOC, an affiliate of the China National Petroleum Corporation, for which the two parties plan to connect gas pipes from Myanmar to inland China. The plan, up until now, has been managed successfully in terms of finance.
Daewoo International is investing $4.7 to $4.8 billion in Myanmar, and its business partners are sharing the financial burden with the company relative to their shares. Daewoo plans to fund the project with loans and direct investments, and the company does not expect to have any problem as its funding program has almost been finalized.