OBG talks to Jean-Marie Guillermou, Senior Vice-President Asia Pacific, Total Exploration & Production

Interview: Jean-Marie Guillermou

What impact will the entrance of new international players have on Myanmar’s oil and gas industry?

JEAN-MARIE GUILLERMOU: Since 2011 Myanmar has turned a new page. There is no doubt these profound changes are essential for both the population and the economy. Reforms and the easing of international sanctions will bring about new opportunities and broaden possibilities for international players to contribute to social and economic development. The historical presence of Total in Myanmar highly illustrates the positive impacts international oil companies can have, not only in terms of economic growth, technology transfer, management methods and infrastructure, but also in terms of job creation, education and training, fair labour practices and awareness of safety, ethics and human rights issues. We have been here since the 1990s, operating the Yadana gas field, and we have chosen to stay because we believe that responsible economic development and human rights go hand-in-hand. This is not a quick charity fix on the sidelines of business activities; it is work that takes time and a long-term commitment to the country by all international oil and gas companies.

In what ways has Total attempted to balance operations with benefits for local communities?

GUILLERMOU: Being a socially responsible investor is a key axe of our approach. In addition to our commitment to the principles set out in the Universal Declaration of Human Rights and the International Labour Organisation’s charter, our subsidiary has put in place a Code of Conduct to govern its operations and those of its subcontractors. For more than 20 years, Total has actively promoted human rights and social and economic development through our Socio-Economic Programme, launched in 1995, and via our commitment to treating vision problems with Helen Keller International. We continue to forge ahead and have recently launched the Awango programme, which provides affordable and reliable solar lighting to low-income communities. Today, many specialists and onlookers agree that our good practices should become more widespread and serve as a model for investors. We have even been recognised as a responsible operator by Aung San Suu Kyi, a member of Myanmar’s House of Representatives and a Nobel Peace Prize laureate.

How would you assess Myanmar’s energy sector in comparison to other emerging markets?

GUILLERMOU: Thanks to sustained economic growth – more than 6% in 2012 – Myanmar is a newly open, promising country in the region. Even if agriculture remains central to the economy and development has been hampered by government policies, Myanmar can rely on abundant natural resources, a market of over 55m consumers and a low cost of labour, as well as regional integration due to its membership in ASEAN.

The first reforms implemented by the authorities, including a law on foreign investment and the creation of a floating exchange rate, are among the economic decisions favourable to international firms.

Myanmar is one of the world’s oldest oil producers, though current production is only 180,000 barrels of oil equivalent per day, of which 90% is gas. Since 2004 the authorities have opened more blocks to foreign firms. By 2007 nine foreign oil firms were involved in 16 onshore blocks to explore new areas, enhance recovery from existing fields, reactivate fields where production had been suspended, and produce oil and gas.

In 2013 the Ministry of Energy launched two bidding rounds for 18 onshore and 30 offshore blocks, for which many firms, including Total, have pre-qualified.

Although we know that exploration should confirm the potential oil and gas resources of the country, we are willing to expand oil and gas production and meet the market’s needs. In 2012 we acquired a 40% share in the M-11 Deep Offshore Block in the Martaban basin, and we wish to continue exploration and production in the future, if given the opportunity. In the new political and economical context, we aim to increase our presence while remaining a socially responsible investor.