Myanmar: Energy Sector Initial Assessment
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Myanmar Energy Sector Initial Assessment Myanmar Energy Sector Initial Assessment October 2012 © 2012 Asian Development Bank All rights reserved. Published 2012. Printed in the Philippines. ISBN 978-92-9092-902-4 (Print), 978-92-9092-903-1 (PDF) Publication Stock No. RPS125206-3 Cataloging-In-Publication Data Asian Development Bank. Myanmar: Energy sector initial assessment. Mandaluyong City, Philippines: Asian Development Bank, 2012. 1. Energy. 2. Power. 3. Myanmar. I. Asian Development Bank. The views expressed in this publication are those of the authors and do not necessarily reflect the views and policies of the Asian Development Bank (ADB) or its Board of Governors or the governments they represent. ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. By making any designation of or reference to a particular territory or geographic area, or by using the term “country” in this document, ADB does not intend to make any judgments as to the legal or other status of any territory or area. ADB encourages printing or copying information exclusively for personal and noncommercial use with proper acknowledgment of ADB. Users are restricted from reselling, redistributing, or creating derivative works for commercial purposes without the express, written consent of ADB. Note: In this publication, “$” refers to US dollars. 1550 Metro Manila, Philippines Tel +63 2 632 4444 Fax +63 2 636 2444 www.adb.org For orders, please contact: Department of External Relations Fax +63 2 636 2648 [email protected] Printed on recycled paper. Contents List of Tables, Figures, Boxes, and Maps iv Acknowledgments vi Weights and Measures vii Currency Equivalents vii Abbreviations viii I. Energy Sector Initial Assessment: Context and Strategic Issues 1 A. Introduction 1 B. The Country Context 1 C. Overview of the Energy Sector 2 D. Coal Subsector 6 E. Oil and Gas Subsector 8 F. Renewable Energy 15 G. Power Subsector 23 H. Energy Efficiency 35 I. Climate Change 36 J. Environmental and Social Safeguard Requirements for Energy Projects 37 II. Potential International Involvement 38 A. Data Requirements 38 B. Areas of Possible Support for the Energy Sector 38 Appendixes 1 Problem Tree 40 2 Coal 41 3 Oil and Gas 46 4 Renewable Energy 47 5 Power 48 6 The Government of Myanmar’s Plan for the Power Subsector 58 iii Tables, Figures, Boxes, and Maps Tables 1 Reserve Estimates of Coal in 2011 6 2 Future Recoverable Oil Reserves by Region 10 3 Future Recoverable Gas Reserved by Region 10 4 Reported Profile of Myanmar Petroleum Block Concession 10 5 Natural Gas Export 12 6 Amount of Royalty from Both Gas Fields 12 7 Domestic Use of Natural Gas 13 8 Refineries in Myanmar, 2011 14 9 Official Retail Prices of Major Petroleum Products, 2004–2011 14 10 Planned Micro-Hydropower Projects in Border Areas 16 11 Predicted Supply of Fuelwood as Indicated in the National Forestry Master Plan 17 12 Biogas Energy Projects in Myanmar 19 13 Wind Energy Projects in Myanmar 21 14 Installed and Available Generation, 2012 28 15 Annual Total Generation and Maximum Demand 28 16 Hydropower Potential by River Basin (Including Tributaries) 29 17 Existing Transmission Lines, 2012 30 18 Transmission Losses 30 19 Existing Distribution Lines, 2012 31 20 Distribution Losses 31 A2.1 Major Coal Deposits in Myanmar 42 A2.2 Chemical Analysis of Coal Deposits in Myanmar 44 A2.3 Coal Production and Consumption 45 A5.1 Installed and Available Generation, 2012 50 A5.2 Existing Generating Plants for Hydropower, 2011 51 A5.3 Annual Energy Generation for Hydropower, 2007-2011 52 A5.4 Hydropower Projects Implemented by the Ministry as Sole Investment 53 A5.5 Power Projects Implemented by Local Entrepreneurs on Build-Operate-Transfer Basis 53 A5.6 Hydropower Projects to be Implemented by Foreign Direct Investments 54 A5.7 Coal-Fired Power Plant Projects to be Implemented by Foreign Direct Investments 55 A5.8 Electricity Consumption, April 2010–March 2011 56 A5.9 Domestic Electricity Consumption, April 2010–March 2011 57 A6.1 Estimated Growth in Power Demand 58 A6.2 Potential Generation Investment 62 A6.3 Potential Transmission and Substation Investment 63 A6.4 Summary of Yangon City Electric Supply Board’s Proposed 2013–2016 Program for Yangon City 64 A6.5 Summary of Yangon City Electric Supply Board’s Priority Projects for Yangon City, 2013–2014 64 iv Tables, Figures, Boxes, and Maps v Figures 1 Myanmar’s Total Primary Energy Supply, 2000–2009 3 2 Myanmar’s Total Final Consumption by Source, 2000–2009 4 3 Myanmar’s Total Consumption by Sector, 2000–2009 5 4 Organizational Chart of the Ministry of Energy 5 5 Organization and Function of Minstry of Electric Power 24 6. Organizational Overview of the Whole Power Sector 25 7 Organizational Chart of the Ministry of Electric Power No. 1 25 8 Organizational Chart of the Ministry of Electric Power No. 2 26 9 Growth in Peak Load 32 10 Monthly Load (January–August 2011) 33 11 Load Shedding (January–August 2011) 33 12 Electrification and Unit Consumption 34 Boxes 1 Production Coordination through the Coal Mining Group 7 2 Myanmar–People’s Republic of China Gas Pipeline Project 12 3 Jatropha Plantation Project for Biodiesel Production 20 Maps A2 Coal Basins of Myanmar 41 A3 Location Map of Oil and Gas Fields in Sedimentary Basins of Myanmar 46 A4 Location Map of Mini-Hydropower Stations 47 A5.1 Existing Transmission System 48 A5.2 Planned Transmission System 49 Acknowledgments This report was prepared by a team led by Jong-Inn Kim (lead energy specialist, Southeast Asia Department [SERD]), and team members Edward Baardsen (principal infastructure specialist, SERD, retired), Kee-Yong Nam (senior economist, Economics and Research Department), Duy-Thanh Bui (senior energy economist, SERD), Pradeep Tharakan (climate change specialist, SERD), and Michael Breckon (consultant). The team was encouraged and supervised by Anthony Jude (director, Energy Division, SERD). Staff support was provided by Christine Samaniego (senior operations assistant). Guidance and support were provided by Kunio Senga (director general, SERD), Putu Kamayana (advisor, Office of the Director General, SERD), and Richard Bolt (advisor, Office of the Director General, SERD). The team also thanks David Husband (consultant) and colleagues from ADB’s Department of External Relations for their support in editing, proofreading, and formatting the report. The team was grateful to all the government officials from seven concerned ministries responsible for the energy sector activities—Ministry of Energy (overall energy policy, oil, and gas); Ministry of Electric Power (power); Ministry of Mines (coal); Ministry of Agriculture and Irrigation (biofuels and micro- hydropower for irrigation purposes); Ministry of Science Technology (renewable energy); Ministry of Industry (energy efficiency); and Ministry of Environmental Conservation and Forestry (fuelwood, climate change, and environmental safeguards requirements), as well as the Ministry of National Planning and Economic Development, which met with the team during its visit to Myanmar and provided the team with necessary information and valuable advice. vi Weights and Measures bbl – barrel BCF – billion cubic feet BCM – billion cubic meter BOPD – barrels of oil per day ft3 – cubic feet GWh – gigawatt-hour ha – hectare Hz – hertz km – kilometer km2 – square kilometer kV – kilovolt kVA – kilovolt ampere kW – kilowatt kWh – kilowatt-hour MCF – thousand cubic feet MMbbl – million barrel MMCFD – million cubic feet per day MTOE – million tons of oil equivalent MW – megawatt MWh – megawatt-hour MVA – million volt-ampere TCF – trillion cubic feet Currency Equivalents (as of 26 October 2012) Currency Unit = kyat (MK) MK1.00 = $0.0012 $1.00 = MK851.225 vii Abbreviations ADB – Asian Development Bank AFOC – ASEAN Forum on Coal ASEAN – Association of Southeast Asian Nations CNG – compressed natural gas CNPC – China National Petroleum Corporation DEP – Department of Electric Power DHPI – Department of Hydropower Implementation DHPP – Department of Hydropower Planning ESE – Electricity Supply Enterprise GDP – gross domestic product GMS – Greater Mekong Subregion HPGE – Hydropower Generation Enterprise IEA – International Energy Agency JVA – joint venture agreement LPG – liquefied petroleum gas MEPE – Myanmar Electric Power Enterprise MES – Myanmar Engineering Society MIC – Myanmar Investment Commission MOAI – Ministry of Agriculture and Irrigation MOE – Ministry of Energy MOECAF – Ministry of Environmental Conservation and Forestry MOEP – Ministry of Electric Power MOF – Ministry of Forestry MOGE – Myanma Oil and Gas Enterprise MOI – Ministry of Industry MOM – Ministry of Mines MOST – Ministry of Science and Technology MOU – memorandum of understanding MPE – Myanmar Petrochemical Enterprise MPPE – Myanmar Petroleum Products Enterprise MTU – Mandalay Technological University NCEA – National Commission for Environmental Affairs NEDO – New Energy and Industrial Technology Development Organization PRC – People’s Republic of China PSC – production sharing contract PTTEP – PTT Exploration and Production Public Company UNFCCC – United Nations Framework Convention on Climate Change YESB – Yangon City Electricity Supply Board viii I Energy Sector Initial Assessment: Context and Strategic Issues A. Introduction 1. This initial assessment of Myanmar’s energy sector highlights the government’s plans for addressing priority energy needs, challenges and opportunities, and identifies—in a preliminary manner—possible