(Yicai) July 19 -- Offshore Oil Engineering said the Chinese company has scored a USD523 million deal to build the fourth phase of an offshore natural gas project in Myanmar for a consortium led by South Korean steelmaker Posco International.

Under the engineering, procurement and construction contract, the unit of China National Offshore Oil Corporation will be responsible for designing the project, buying equipment, renovating the drilling platform, installing underwater facilities, and pre-commissioning drilling gear, it said yesterday. Construction should be finished within three years.

It is the first time for the Shanghai-based engineering firm to be chosen as the EPC contractor for an international oil and gas project that is over 1,000 meters under water, demonstrating Posco’s faith in its abilities, Offshore Oil said. If the project goes well, it will have a positive impact on the company’s operating results and reputation, it added.

The Shwe offshore natural gas field is located off Myanmar’s Rakhine state in the Bay of Bengal. The field was found in 2004 and forms part of a larger natural gas reserve found in the region. Commercial output began in 2013 and it produces about 560 million cubic feet of gas a day, most of which is sold to China, the world’s third-biggest consumer of the fuel.

The consortium headed by Seoul-based Posco, which has the largest stake, is developing the field.

Shares of Offshore Oil [SHA: 600583] ended 0.4 percent down at CNY5.65 (78 US cents) apiece today, pulling back from a drop of as much as 1.6 percent. The benchmark Shanghai Composite Index added 0.2 percent.

Editor: Kim Taylor