PTT plans oil, LPG terminal project in Burma

Thailand's state-controlled PTT is planning to build an oil product and LPG storage terminal in Myanmar (Burma), as the country's fast-growing economy continues to draw energy investment.

The company's retail arm PTTOR and domestic private-sector firm Bright Energy have agreed a joint venture for the warehouse and port project in Thilawa, near Myanmar's commercial capital Yangon. The terminal will have the capacity to store over 1mn bl of oil and 4,500t of LPG, which the companies said will make it the largest oil depot in the country when it is completed in 2021.

PTTOR and Bright Energy will also set up wholesale and retail sales operations, targeting 1,000 t/month of LPG sales. Further details of the joint venture are unclear.

Foreign companies are increasingly eyeing investments in Myanmar's energy sector. Midstream and downstream company Puma Energy, which is backed by global trading firm Trafigura, opened a 91,000m³ (570,000 bl) oil product terminal at Thilawa in 2017. China's state-controlled PetroChina started retail sales of motor fuels in Myanmar earlier this year.

The country has the fastest-growing economy in southeast Asia, according to the Asian Development Bank, with GDP growth projected at 6.6pc this year. But US and EU sanctions against the country's previous military administration, which were eased following political and economic reforms that started in 2011, have left the country acutely short of energy infrastructure.

Myanmar has just three ageing refineries and relies on fuel imports from China, Singapore and elsewhere in the region. Its LPG demand is largely met through truck sales from Thailand and more recently China, with domestic output at only around 10,000 t/yr, well short of domestic demand that could hit 80,000t this year.

Two other LPG terminals came on line last year and three more could start up by 2020, taking total storage capacity to more than 14,000t.

Chinese firms are building the country's biggest energy infrastructure project, a deepwater port and terminal project at Kyaukpyu in western Rakhine state, from where crude and natural gas is exported to China through the 1,500km Burma Road pipeline network. Civil unrest in Rakhine, and international criticism of Myanmar's crackdown on the Rohingya ethnic group, threaten to shut out some of the renewed foreign interest in the energy sector.