JIM MIDDLETON, PRESENTER: Among the businesses in Naypyidaw for the World Economic Forum was Woodside Petroleum.
Last year, the Australian oil and gas company bought 40 per cent of an exploration block offshore from Myanmar.
Peter Coleman is Woodside's chief executive.
Peter Coleman, very good to be talking to you.
PETER COLEMAN, CHIEF EXECUTIVE, WOODSIDE PETROLEUM: Hello, Jim.
JIM MIDDLETON: Woodside bought two oil and gas exploration blocks off Myanmar. It is early days, I know, but has it been a happy experience so far?
PETER COLEMAN: Well look it has so far. We decided to be an early mover into Myanmar, it's a proven oil and gas province historically. It's got quite a low discovered resource base to date, but we looked at the potential of Myanmar, we looked at the partners we could partner with and decided to make an early move.
JIM MIDDLETON: Any immediate problems or obstacles that you weren't expecting?
PETER COLEMAN: No, no, not at all. In fact, we found a lot of help both from the ministry, from the national oil and gas company and also, particularly. our partners. So we've already spent $20 million here. We only entered at the beginning of this year. We’ll spend another $20 million by the time we finished the year, and everything has gone very smoothly so far.
JIM MIDDLETON: You are considering bidding for more exploration licences, more blocks. Is that a sign of confidence or rather that for your company to grow you have to be in the Myanmar game?
PETER COLEMAN: It's a little bit of both, actually. We have to look for regions like Myanmar, which we really call greenfield regions, places that really haven't been drilled but hold the pretty high hydro carbon potential. So we to have to look for those and Woodside has been in countries like that, and that's Myanmar.
Equally on the business side we have to look at it and say can we construct a business there and create the value we're looking for? We see some early positive signs.
JIM MIDDLETON: These are very long term investments that you're making. Are you content with the rate of movement here on issues like you just mentioned, like the rule of law, like getting rid of the legal obstacles to doing business, certainty of investment, transparency, corruption and so on?
PETER COLEMAN: In fact we are. The changes that are going in place, particularly in the laws, are very fast. In fact, as you know, even only a few months ago the foreign investment law was put into place. In fact, my last visit in October last year, that law was being debated.
Myanmar has now just signed up for the Extractive Industries Transparency Initiative, which again is very important as well because that shows where revenues go. So if you think about the pace of change it's quite staggering.
Having said, that it's all the enabling regulations now that need to be put in place. A number of those are already in place and for oil and gas we've been here for a while anyway.
JIM MIDDLETON: Is that the point you were trying to make when at a WEF session, starring I suppose Aung San Suu Kyi, you suggested that the rule of law was the key to this country's future?
PETER COLEMAN: Absolutely it is. Once you get past safety and security, investors really look for rule of law. Because rule of law, when you look at the types of investments we're making, the investment horizons are 10 years, 15, 20 years, plus; that will go through many political motivations over time. So you're really looking for stability in rule of law.
JIM MIDDLETON: How much of an obstacle do you think it is to people having confidence in doing business here that the elections, the next elections are two years away, there's still question marking over whether Aung San Suu Kyi will be allowed to run, the country's future is still in the balance somewhat. What sort of a barrier is that, do you think?
PETER COLEMAN: I think every company has to assess their own risk profile on that. We’ve looked at ours and we have staged our investments on the way through. Not just from a political point of view and how are things going to work their way through the system but also from ourself, from that unknown part of discovery the hydro carbon resource.
So we've balanced the two up, we’ve got an investment profile that we think marries those two risks tog together.
JIM MIDDLETON: In that risk profile are you betting that Aung San Suu Kyi will end up being President of this country? Do you think the law will change so that she can run? Would that make you more confident about doing business here long-term?
PETER COLEMAN: No, we don't make political bets, because our investment horizons are so long. What we do look for is process. And as you mentioned there's been some dialogue around the conference that give us a lot of confidence in the process itself, because hard discussions are being had, and are being had in a very public way. So that gives us some confidence. One of those feel things. It is hard to actually put your finger on it and say it's this or this, but when you get a sense of the dialogue it's very positive.
JIM MIDDLETON: As far as Australia's concerned, you're here, Twiggy Forrest from Fortescue Metals is here, not that many others. Are you surprised, given the expressed desire of Australia to be genuinely contributing to development in the Asia-Pacific, that there isn’t more attendance at a cellar function like this, the WEF?
PETER COLEMAN: We're here because we made a commitment and when you make commitments you really need to show the support that’s required and that goes behind that commitment. That's what partnerships are about. And I understand that’s why Andrew was here and also participating in the conference.
Partnerships are about making the commitments and doing the things you need to do. I think Australian companies have got a wonderful opportunity in Myanmar. Many of them are making visits, they’re not at the conference yet. I would encourage them to make early investments.
JIM MIDDLETON: Peter Coleman, thank you very much for your time.
PETER COLEMAN: Thank you very much.