Two Big Western Oil Firms to Play Leading Roles at Rangoon Energy Conference
Two Big Western Oil Firms to Play Leading Roles at Rangoon Energy Conference
Two major Western multinational oil companies are to play a leading support role in the Rangoon oil
and gas industry forum planned for September by the Ministry of Energy and MOGE, the state-run
Myanmar Oil & Gas Enterprise.
The Dutch-British group Shell will present an assessment of Burma’s offshore deep-water “new frontier”
for oil and gas exploration, and ConocoPhillips of the United States will talk about onshore prospects.
The second oil, gas and power conference to be held in Rangoon this year has been extended from two
daysto four, and will now take place from September 3-6.
Other major industry speakers include senior managers from Essar Oil of India and Unocal, which is
part of theUS’s Chevron Corporation, say the conference co-organizers, the Center for Management
Technology (CMT).
Unocal and the Chinese state oil giant CNOOC are sponsoring lunches at the conference.
The conference will be opened by Energy Minister Than Htay, who will outline opportunities for
investors in thesector.
The ministry has previously said about 40 gas and oil exploration blocks will be put up for international
auction before the end of this year, and details could be unveiled at the September conference.
Twenty-five offshore blocks will be offered and up to 18 onshore sites, the ministry’s assistant director of
planning, Aung Kyaw Htoo, has previously said.
The first oil and gas conference in March attracted 150 companies, according to CMT, but failed to find
takers for half of 18 onshore exploration blocks.
Industry insiders say the greatest interest will be in the offshore blocks, where large volumes of natural
gas havealready been found.
More Transparency Needed in Business Law Debate, Says US Ambassador
Potential foreign business investors in Burma need clearer evidence that the country’s economy is
becoming more open and not drifting towards over-protection of some domestic businesses, the new US
ambassador said.
“I hear about momentum moving toward protection of certain industries, certain companies,” Ambassador
Derek Mitchell told The Wall Street Journal this week. “It’s understandable to some degree, but is that really
going to get you the sort of investment and development you really want over time?”
Mitchell, speaking to the US business newspaper this week also voiced concern about delays in the
promisednew foreign investment law and the lack of transparency in its preparation.
“Recent media reports have indicated that the government is now considering restricting foreign
involvementin some sectors, including agriculture, but recent drafts of the law haven’t been available,
” The Wall StreetJournal reported on Aug. 20. “A government official in the capital of Naypyidaw
declined to comment.”
Mitchell said that despite numerous encouraging changes and promised reforms, Burma’s emergence
from decades of isolation remains fragile.
“There are going to be lots of bumps, lots of setbacks, and not a clear path forward,” he said.
Twenty Years for Burma to Match Asean Neighbors’ Standard of Living
It will probably take the best part of two decades for Burma to become a middle-income country with
per capita income in Burma reaching US $3,000 a year, the Asian Development Bank (ADB) said.
At present Burma has the lowest per capita GDP in Asia, the ADB said this week in an assessment of the
country’s economy and prospects in the wake of political reforms and promised economic liberalization.
Burma’s economy could expand by 7 percent to 8 percent a year “if it can surmount substantial
development challenges by further implementing across-the-board reforms,” the ADB study “Myanmar
in Transition: Opportunities and Challenges” said.
“[Burma’s] strategic location, rich natural resources and abundant labor force leave it perfectly positioned
to prosper from Asia’s dynamic economic growth,” said Stephen Groff, ADB’s vice president for East Asia,
Southeast Asia and the Pacific. “[Burma] could be Asia’s next rising star, but for this to happen there needs
to be a firm and lasting commitment to reform.”
Investment in education, health and social services is needed to reduce poverty and strengthen social
cohesion, the report recommends.
“Although more than half of [Burma’s] people rely on agriculture for a living, less than 20 percent of the
country’s crop land is irrigated. “Investment in irrigation and other inputs could dramatically expand
crop yields and boost incomes.”
Other keys to the country’s potential are improvements in infrastructure in transport, power and
telecommunications services, plus modernization of the financial sector.
“[Burma’s] economic base must also broaden beyond agriculture to the manufacturing and service
sectors to meet a growing demand for jobs,” the report said.
The ADB re-opened an office in Burma after an absence of 24 years.
Thai Government to Seek Japanese Help to Push Dawei Port Forward
The government of Thailand is keen to push forward the Dawei port and economic zone on Burma’s
southeast coast and is preparing to seek financial support from Japanese state loan agencies, The
Financial Times of London reported.
“The Thai government has established a Dawei secretariat to oversee government involvement in the
project and is creating a high-level team, led by Kittirat Na-Ranong, finance minister, to help secure
funding,” the newspaper said in a report on Aug. 23. “It will soon initiate discussions with Japan about
Dawei-related infrastructure projects.”
The Bangkok government will seek aid from the Japan International Co-operation Agency and the Japan
Bank for International Co-operation for a “strategic corridor” of transport infrastructure to link Dawei
with the Thai border, said The Financial Times quoting managing director of Dawei Development, Somchet
Thinaphong.
Dawei Development is a subsidiary of major Thai construction firm Italian-Thai Development, which has
the concession fromthe Burmese government to develop Dawei.
But the huge US $50 billion project has been in limbo for over a year, triggered by environmental
restrictions imposed byBurma’s first post-military junta government and subsequent difficulties by ITD
in securing investment partners.
The Burmese president banned ITD plans for a massive 4,000 megawatt electricity generating station in
Dawei because it was to be fueled by coal.
Somchet told The Financial Times that his company hoped to finalize agreements with the Burmese
authorities within the next month,and if that happened ITD could “have the first phase accomplished by
the end of 2015.”
