Japanese company Eneos has completed the necessary procedures for it to withdraw from the exploration and production sector in Myanmar, a little after two years since the military seized power in a coup.
Since the February 2021 coup, the security situation has deteriorated in Myanmar with a single air strike last Tuesday alone claiming a reported 170 civilian lives, including 40 children. The air strike targeted dozens of local residents from a Central Myanmar village that had gathered to mark the opening of a new administrative centre built with help from the People’s Defence Force, an anti-junta militia group, according to the Thai English Language daily Bangkok Post.
Eneos’ subsidiary Nippon Oil Exploration Myanmar (JXM), 40% of the shares of which are owned by Japan’s JX Nippon Oil & Gas Exploration, last April informed Malaysia’s national upstream company Petronas Carigali and the other partners of its intention to exit the producing Yetagun asset. Eneos at the time said it was exiting the project in response to “social issues”, amid criticism that the project’s revenues are flowing to the nation’s military junta.
The other co-venturers in JXM are the Japanese government via the Ministry of Economy, Trade and Industry with 50% and compatriot Mitsubishi on 10%.
Association of Southeast Asian Nations (Asean) chair Indonesia issued a statement condemning last Tuesday’s military air strike.
“Asean strongly condemns the reported recent air strikes carried out by the Myanmar Armed Forces in Pa Zi Gyi village, Kanbalu Township, Sagaing Region of Myanmar that claimed the lives of at least dozens of civilians,” the statement read.
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The association called for an immediate end to all forms of violence, particularly the use of force against civilians, stating this would be the “only way” to a conducive environment for inclusive national peace talks.
Despite the deadly air strike, Asean is holding to the five-point peace plan that the 10-member regional group adopted in 2021, to address the Myanmar crisis.
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JXM held a 19.31784% interest in the Petronas Carigali-operated Yetagun gas field offshore Myanmar, where output has been in natural decline in recent years. The partner’s actual sales volume from the asset in 2021 was 585 barrels of oil equivalent per day.
The offshore field was shut-in for part of 2021, with operator Petronas Carigali declaring force majeure as production fell below the technical threshold of the offshore gas processing plant.
Yetagun straddles blocks M-12, M-13 and M-14 in the Andaman Sea offshore Myanmar. The field had estimated reserves of 3.2 trillion cubic feet of gas and had been expected to produce until the end of this decade.
Petronas Carigali last year also announced its intention to withdraw from Yetagun leaving just the partners PTTEP of Thailand and state-owned Myanma Oil & Gas Enterprise.
Eneos, which completed its withdrawal from the E&P business in Myanmar on 12 April 2023, noted the impact of this move on its consolidated financial results is expected to be minimal.