Nippon Oil To Boost Gas, Oil Output In SE Asia ( Nikkei ) October 11, 2002


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Nippon Oil To Boost Gas, Oil Output In SE Asia

TOKYO (Nikkei)

Japan's Nippon Oil Corp plans to double natural gas production in Myanmar by fiscal 2004 and boost oil output in Vietnam by about 40% from this month, the Nihon Keizai Shimbun reported in its Saturday morning edition, citing company sources.

The company, which has seen profits from its gasoline sales eroded by higher crude oil and gas prices, hopes to benefit from the increased profitability of natural resources development projects.The company aims to triple its output of gas and crude by fiscal 2004 for sale to other Asian countries.

In Myanmar, Nippon Oil has established a consortium with a local state-run oil firm and others, with its subsidiary holding a 14% stake in the entity. The offshore gas field, about 400 kilometers south of the Myanmarese capital of Yangon, produces 5.7 million cubic meters of gas a day.

Nippon Oil plans to invest more than Y10 billion by fiscal 2004 to install new equipment to extract water from gas, for example. The company is also considering raising its stake in the consortium to about 20% by next spring. The output is supplied via pipeline to Thailand, where gas demand is rising due to the construction of new power generation plants in the country.

In Vietnam, the company and a local state-run firm jointly operate an oil field 100 kilometers-150 kilometers offshore from the coastal city of Vung Tau. The daily output is about 50,000 barrels. The Japanese oil firm owns rights to 25% of the total output and sells the oil to Japan and other Asian countries.Nippon Oil intends to develop a new field in the area to raise production to 68,000 barrels this month.The company obtains about 50,000 barrels of crude and gas each day from resources development concerns it has invested in, or equivalent to 5% of the total crude it refines. Its profitability lags major U.S. and European oil firms, which each generate net profits of about Y1 trillion annually through oil and gas production.

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