LNG pipeline connectivity with Myanmar, Bangladesh on the cards

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New Delhi: In a bid to counter China’s dominance in the region and ensure energy security, India plans liquefied natural gas (LNG) pipeline connectivity with Myanmar and Bangladesh, two people familiar with the development said.

The proposal for a gas pipeline connecting the three countries was initially discussed in 2005-06.

The talks collapsed after Myanmar decided to go ahead with an oil pipeline to China.

However, guided by its Act East policy and recent volatility in energy markets due to the war in Ukraine, India plans to renew efforts for interconnectivity of the three nations’ gas networks.

“Gas pipeline connectivity with neighbors to the east is being discussed, as both countries have large gas reserves and should be willing to sell their products,” one of the two officials said.

The plans are to connect the pipeline with the northeastern natural gas pipeline network operated by Indradhanush Gas Grid Limited (IGGL) in Tripura, the official said.

IGGL is a joint venture of Indian Oil Corporation Ltd (IOCL), ONGC, GAIL, Oil India Ltd (OIL) and NRL.

Estimates show that as of 2021, Myanmar’s natural gas reserves stood at 22.5 trillion cubic feet.

China and Thailand are among Myanmar’s top LNG importers. Major public sector company ONGC Videsh Ltd (OVL) and GAIL also hold 17% and 8.5% stakes respectively in the country’s A1 and A3 blocks.

However, in 2013, China prevailed over the Myanmar government to sell it gas through a bilateral pipeline, after which the plan for an India-Myanmar pipeline was shelved.

Although Bangladesh has seen a decline in its reserves and has its own high requirements for power generation, the Dhaka government is making efforts to increase its reserves by taking on more exploration activities across the country. Last year, Bangladesh discovered a new gas field with the capacity to produce 20 million cubic feet of gas per day (MMCFD) at the Koilastila gas field.

Inquiries sent to the ministries of oil, foreign affairs, the Bangladesh High Commission in Delhi and the Myanmar embassy went unanswered as of press time.

Under the 2030 Hydrocarbons Vision for northeast India, the government also plans to make the northeast a transit hub for oil and gas.

If this pipeline comes up, it would give the plan a boost.

India has been looking to increase its domestic production of hydrocarbons and also expand its sources of energy imports. India imports about 85% of its total energy requirement.

The Russia-Ukraine war and its impact on the energy market have accelerated India’s efforts to secure more and more sources of LNG and oil supplies. The efforts come against the backdrop of the former subsidiary of the Russian company Gazprom, Gazprom Marketing and Trading Singapore (GMTS), which has defaulted on its long-term contract for the supply of LNG to GAIL since May last year. Attempts to secure more long-term contracts and new LNG suppliers are underway after spot LNG purchases topped the $40 per million British thermal unit (mBtu) mark in September.

On January 26, the Mint reported that state-owned companies IOCL and GAIL are in talks with the United Arab Emirates’ Abu Dhabi National Oil Company (ADNOC) for a long-term LNG supply contract.

India is already making efforts to establish cooperation in the region to meet mutual energy requirements and somehow check China’s dominance. The 130-kilometre India-Bangladesh Friendship Pipeline which would connect Siliguri in West Bengal and Parbatipur in the Dinajpur district of Bangladesh and help India export petroleum products to its eastern neighbor is also underway and is expected to be put into service soon.

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