Amidst a brutal border standoff, the government has approved investments in a Myanmar project which will lead to more gas for China.

The Cabinet Committee of Economic Affairs, under Prime Minister Narendra Modi, has approved an additional investment of $121.27 million by ONGC Videsh for the development of Block A-1 and A-3 of the Shwe oil and gas project in Myanmar.

The gas produced from the project is being distributed locally in Myanmar, as well as sold to China by China National United Oil Corporation through a 40-inch diameter pipeline at the rate of four million cubic feet per day.

OVL, the overseas arm of state-owned ONGC had picked up a stake in the Shwe project in Myanmar in 2002. The company has invested $722 million till March 31, 2019.

The first gas from the Shwe project was received in July 2013 and plateau production was reached in December 2014. The project has been generating positive cash flows since 2014-15.

The project is being developed in a three-phase scheme by a consortium of six companies, led by Posco subsidiary Daewoo International.

The consortium includes Posco Daewoo International (51 per cent, operator), Oil and Natural Gas Corporation (ONGC) Videsh (17 per cent), Myanmar Oil and Gas Enterprise (15 per cent), GAIL (8.5 per cent), and Korean Gas Corporation (8.5 per cent).

“The participation of Indian PSUs in oil and gas exploration and development projects in neighbouring countries is aligned with India’s Act East Policy, and is also part of India’s efforts to develop Energy Bridges with its immediate neighbours,” a release said.

sChina nd India on Wednesday agreed to jointly maintain peace and transquility in the border areasThe first gas production from phase one of the Shwe natural gas project was achieved in July 2013. Phase two and three are currently under development. First gas from phase two of the project is expected in the second quarter of 2022.

The gas produced from the project is being distributed locally in Myanmar, as well as sold to China by China National United Oil Corporation (CNUOC) through a 40in diameter pipeline at the rate of four million cubic feet per day.

"The participation of Indian PSUs in oil and gas exploration and development projects in neighbouring countries is aligned with India's Act East Policy, and also part of India's efforts to develop Energy Bridges with its immediate neighbours," the release said.s