Weekly Business Intelligence

37 Pages·2017·0.44 MB·English

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PwC Myanmar
Weekly Business Intelligence
Issue 110
25 May 2018
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1. Weekly Key Financial & Business News
PwC | May 2018 3
Weekly Key Financial & Business News
Headlines
Government woos private sector in construction of Yangon elevated ring road
LPG terminal opens in Yangon
Elite Petrochemical launches first private-sector LPG project in Myanmar
Korea-Myanmar Industrial Complex to be in Hlegu
Domestic natural gas to be made available by 2023: MOEE
PwC | May 2018 4
Newspapers
Myanmar Times
Government woos private sector in construction of
Yangon elevated ring road
21 May 2018
The Ministry of Construction (MOC) is inviting infrastructureprojectsincludedundertheYangon
the private sector to submit Expressions of UrbanTransportDevelopmentPlan.
Interest(EOI)toparticipateintheconstructionof The aim of the ring road is to alleviate traffic
anelevatedfour-laneringroadinYangon. congestioninYangon.Longdistancetrafficwillbe
The MOC on May 18 invited both local and diverted onto the ring road while vehicles
international companies interested in designing, traveling short distance can continue plying the
engineering, financing, constructing, operating existingYangonroads.
and maintaining the proposed expressway under “It is a good plan. But the necessary feasibility
aPublicPrivatePartnership(PPP)tosubmitEOIs studies for the project will still need to be carried
beforeJune29. out first,” said Dr Kyaw Latt, a local urban
Anofficialtenderprocessisexpectedtotakeplace planningexpert.
laterintheyear,theMOCsaid.
Italsoaddedthatitmaydecidetosplittheproject
into sections involving multiple tenders. Each
section will be developed under a PPP structure
orbyacceptingfundsfromtheIFC.
The MOC, together with the Yangon regional
government, is planning to build the
approximately 47.5-kilometer four-lane elevated
ring road to connect downtown Yangon, Yangon
Port, Yangon International Airport, Mingalardon Source:MyanmarTimes
Industrial https://www.mmtimes.com/news/government-
Park and Yangon-Mandalay Expressway. The woos-private-sector-construction-yangon-
project is among several other transport elevated-ring-road.html
PwC | May 2018 5
Newspapers
Eleven Myanmar
LPG terminal opens in Yangon
21 May 2018
Ministry of Electricity and Energy has opened a governmentandprivatesectorcooperate,hesaid.
liquefiedpetroleumgas(LPG)terminalinYangon Electric consumption rate is increased to 15 per
and planned to transport the LPG using tankers cent annually. The government expected the
which can carry up to 2,000 tons, said Win electric consumption rate in 2020-21 FY will be
Khaing, Union Minister for Electricity and 4,531 megawatts of electricity.At the present,the
Energy. ministry can generate 3,189 megawatts of
The use of LPG can reduce the use of foreign electricity annually and need 1,342 megawatts.
currency as it can replace petrol and diesel The ministry is planning to generate 439
importedfromothercountries,sourcessaid. megawatts from three power plants in 2018, 750
The ministry opened compressed natural gas megawatts from four power plants in 2019, 260
(CNG) filling stations in Paleik, Sintgaing megawatts from three power plants in 2020, 971
Township to facilitate the transport sector in the megawatts from five power plants in 2021 and
area starting from 2014 and installed a new CNG 891 megawatts from five power plants in 2022.
compressor to increase the pressurization in Myanmar is generating 15 per cent of electricity
natural gas to 3000 psi.It will reduce the time to fromhydropower plants,18percent of electricity
fill the CNG, to decrease the running time of the from heavy fuel oil power plants, 30 per cent of
compressorandtolessenitsmaintenance. electricity from natural gas fired turbines, 32 per
The use of CNG is cost effective and can reduce cent of electricity from LNG power plants and 5
the environmental damages. The locals need to per cent of electricity from solar plants
followtheinstructionsandneedtocooperatewith respectively.
theministry,saidtheminister.
MyanmarhasconditionsfitfortheLPGmarketto Source:ElevenMyanmar
expand. The LPG industry needs to prepare for http://www.elevenmyanmar.com/business/1395
longtermplan.TheuseofLPGwillincreaseifthe 6
PwC | May 2018 6
Newspapers
Myanmar Times
Elite Petrochemical launches first private-sector LPG
project in Myanmar
21 May 2018
Elite Petrochemical Co launched its Liquefied firsttimeattheport.
Petroleum Gas (LPG) Terminal and Port Facility WithPhase1nowfullycomplete,Phase 2willsee
at the Thilawa Special Economic Zone on the firm building storage capacity for up to
Saturday. The terminal is the first private sector- 25,000 tonnes of LPG and up to 100,000 tonnes
led LPG investment open for business in the of diesel and petrol. This is now around 40
country. percentcomplete,UAungThetMannsaid.
The terminal was developed under a Build, He added that so far, Elite Petrochemical has
Operate and Transfer (BOT) agreement across 49 invested a total of $48 million in the entire
acres of land in Thilawa after receiving approval project. The company is planning to plough an
from the Myanmar Investment Commission and additional $80 million to complete construction
onrecommendationfromthegovernment,saidU oftheoilandgasstoragetanks.
Aung Thet Mann, executive chair of Elite Thelaunchcomesatatimewhenthegovernment
Petrochemical, during the opening ceremony of is encouraging the private sector to invest in the
theterminal. UAungThetMannissonofformer import and distribution of LPG as a clean
PyithuHluttawchairUThuraShweMann. alternative to electricity for cooking. LPG is a
The entire project will be developed in phases. byproductfromtherefiningofpetroleum.
Phase 1 includes construction of a 20,000-tonne In his opening speech, Union Minister for
jetty and storage facilities for up to 3,000 tonnes Electricity and Energy U Win Khaing said wide
ofLPG. adoption of LPG for cooking can helpthe country
Design of the terminal and storage facilities were saveasignificantamountofelectricity.
drawn up with the help of China Harbour Source:MyanmarTimes
Company and China National Petroleum https://www.mmtimes.com/news/elite-
Company, respectively. In the second week of petrochemical-launches-first-private-sector-lpg-
April, a 1,000-tonne LPG vessel docked for the project-myanmar.html
PwC | May 2018 7
Newspapers
Eleven Myanmar
Korea-Myanmar Industrial Complex to be in Hlegu
22 May 2018
YANGON- US$ 110 million worth Korea- NaingOo,MIC’sSecretary.
Myanmar Industrial Complex(KMIC) project will Not only small, medium and large industries but
be implemented in Nyaungnapin, Hlegu alsoLabourTrainingSchoolofOneStopServices,
Township,YangonRegion. Staff Housing, Park, Sewage refinery Plant,
The approximately 555 acres wide project will Management Office and other services will
begin near Nyaungnapin village, western part of involvedinthezone.
about 5-mile away from the Yangon-Mandalay “Although MIC allows the project, they[Korea]
Expressway and it is a joint venture between must be taken to the proposed site for
Civilian and Housing Development Department construction of industrial zone under agreement
under the Ministry of Construction and Korea of the respective regional government committee.
Land and Housing Cooperation under the If the location is satisfactory, we will allow the
RepublicofKorea. project. Moreover, KMIC project has been
The Memorandum of Agreement on construction involved in the MIC’s promotion sector. But, it
of KMIC project was signed last year and Korea must be cleared regarding the land first,” said
willinvest60percentintheprojectandMyanmar AungNaingOo.
is 40 percent investment. It will start this year
andfinishin2023.
“Korea plans to establish industrial zone in
Nyaungnapin village in cooperation with the
ministry of construction. Both sides have agreed
but project isn’t submitted yet to the Myanmar
Investment Commission (MIC). Korea wanted to Source:ElevenMyanmar
implement the Nyaungnapin industrial zone to http://www.elevenmyanmar.com/business/1396
build Korean factories in the zone,” said Aung 2
PwC | May 2018 8
Newspapers
Myanmar Times
Domestic natural gas to be made available by 2023:
MOEE
23 May 2018
Larger volumes of natural gas will be available addition to electricity and transportation to ten
from Myanmar’s onshore and offshore gas fields economic zones in future as the phase 1, he
within the next five years, yielding fresh informedenergycircle.
opportunitiesforinternationaloilandgasfirmsto “LNG will not only benefit the electricity sector
invest in the sector, said U Win Khaing, Union but also create export opportunities, helping to
MinisterforElectricityandEnergy(MOEE). narrowthetradedeficit,”UWinKhaingsaid.
“Gas production will be a priority for the Because of the high conversion costs involved
governmentoverthenextfewyears.However,we though, LNG becomes a less viable alternative
donothavethecapitalorthetechnologytodoso. overthelongerterm.“Assuch,ourtargetismake
We need to cooperate with international oil and domestic natural gas available from 2023
gasfirmstoproducethegasandindoingsomake onwards. It will take next four or five years if we
itavailableforthecountryassoonaspossible,”he start exploration and production (E&P) work
said. now,”UWinKhaingsaid.
U Win Khaing’s announcement comes even as In Myanmar, natural gas produced at the local
ongoing price negotiations on the import and Shwe, Zawtika and Yadana offshore fields is
distribution of liquefied natural gas (LNG) takes transportedviapipelinestopowerplantswhereit
place between the MOEE and several is used to generate electricity to meet domestic
internationalgasfirms. demand. However, MOEE and Myanma Oil and
The government is planningto import LNG to fill Gas Enterprise (MOGE) officials have warned
an existing shortage of electricity in Myanmar. since2016thatproductionfromthoseblocksisin
Overthenexttwoyears,ithaspromisedtodouble decline.
the current supply of electricity to 6,000 Source:MyanmarTimes
megawattsusingLNG. https://www.mmtimes.com/news/domestic-
The ministry is trying to make gas available in natural-gas-be-made-available-2023-moee.html
PwC | May 2018 9
Weekly Key Financial & Business News
Headlines
Ministry of Construction commits to four mega projects in 2018
Price controls not a viable solution for rising fuel prices: MPTA
Central Bank loans K640 billion to govt to finance deficit
Plans for bridge connecting east and west Yangon in the works
Bago Region set for industrial zones
PwC | May 2018 10