LONDON, Oct 11 (Reuters) - International energy groups say recent signs of political change in autocratic Myanmar are unlikely to lead to a rapid expansion of their activities in the country, which holds valuable reserves of oil and gas.
Christophe de Margerie, Chief Executive of France’s Total SA , said his company, which has a project in the former British colony, would like to play a bigger role in the country, formerly known as Burma, but had to see concrete signs of increased democratisation before this was possible.
Western trade sanctions have been in place since the military crushed a 1988 student uprising isolating Myanmar’s army dictatorships but in March, the army nominally handed over power to civilians after elections in November. The process was ridiculed at the time as a sham to cement authoritarian rule behind a democratic facade.
It was followed by other overtures such as calls for peace with ethnic minority guerrilla groups, some tolerance of criticism and more communication with Nobel Peace Prize laureate Aung San Suu Kyi, who was released last year from 15 years of house arrest.
On Tuesday, state television said 6,359 prisoners would be freed on Wednesday and political detainees are expected to included.
“We decided that... it was important to be in Myanmar but that we will not invest until things are getting better... I do hope that will happen,” Total’s de Margerie told reporters on the sidelines of the Oil and Money conference in London.
Total leads the $1 billion Yadana gas project in the Andaman Sea, and the CEO said he would like to back additional exploration and production investments.
U.S. oil major Chevron is a partner in Yadana but Washington banned new investments in Myanmar by U.S. companies in 1997 and barred imports.
New investments by western oil companies could be a boon for the companies which build and supply their facilities but Andrew Gould, chief executive of the world’s largest oil services company, Schlumberger , said it was too soon to tell the implications from the recent political easing.
Myanmar’s crude oil reserves are estimated at 3.2 billion barrels, the energy ministry has said. This compares with China’s proven oil reserves of 14.8 billion barrels, Malaysia’s 5.8 billion, Vietnam’s 4.4 billion and Indonesia’s 4.2 billion barrels, at the end of 2010, according to the BP Statistical Review.
The country’s proven gas reserves tripled in the past decade to around 800 billion cubic metres, equivalent to more than a quarter of Australia‘s, BP Statistical Review figures show.
Malcolm Brinded, Executive Director for Upstream International, Royal Dutch Shell PLC and Ali Moshiri, President, Chevron Africa and Latin America Exploration and Production Company all declined to talk about possible new investments in Myanmar.