CURRENT ENERGY SITUATION IN MYANMAR

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2 CURRENT ENERGY SITUATION IN MYANMAR 2

3 LOCATION OF MYANMAR IN ASEAN, GMS AND BIMSTEC REGIONS 3

4 UNION OF MYANMAR UNION OF MYANMAR - TOTAL LAND AREA = 676,577 KM 2 - SHARING BORDERS WITH ; BANGLADESH & INDIA = NORTH-WEST CHINA = NORTH-EAST LAOS = EAST THAILAND = SOUTH-EAST - COASTAL STRIP = 2832 KM FACING TO THE BAY OF BENGAL AND ANDAMAN SEA. - ABOUT 52 MILLION PEOPLE WITH AN AVERAGE GROWTH RATE OF 2.0 % PER ANNUM. 4

5 Energy Resources of Myanmar Sector Potential Identified Reserve ydro Power Coal Crude Oil Natural Gas Biomass Geothermal 108,000 MW 711 mmtons mmbbls TCF 50.8% of total with forest 93 hot springs 39,720 MW mmbbls TCF land area covered (344,234 km2) - Oil Shale 5850 mmbbls - 5

6 CURRENT ENERGY SITURATION PRIMERY ENERGY CONSUMPTION Oil 14.94% Gas 11.09% Biomass 66.9% Coal 0.96% Hydro 6.12% Oil Gas Hydro Coal Biomass

7 Sedimentary Basins in Myanmar SEDIMENTARY BASINS SHORE Rakhine Coastal Hukaung Chindwin Shwebo-Monywa Central Myanmar Pyay Embayment Ayeyarwady Delta Bago Yoma Basin Sittaung Valley. Mepale. Mawlamyine. Namyau. Hsipaw-Lashio. Kalaw FSHORE Rakhine offshore Moattama offshore Tanintharyi offshore Shwe-1 STATUS OF EXPLORATION A. Thoroughly Explored Basins 1. Central Myanmar 2. Pyay Embayment 3. Ayeyarwady Delta (Only Part of the Basin) B. Explored to Some Extent 1. Chindwin 2. Rakhine Coastal C. Very Little Explored 1. Hukaung 2. Shwebo-Monywa 3. Bago Yoma D. Not Explored Yet 1. Hsipaw-Lashio 2. Namyau 3. Kalaw 4. Sittaung Valley 5. Mawlamyine 6. Mepale

8 FFSHORE BLOCKS IN MYANMAR

9 Myanmar Offshore Gas Export Projects Export Gas Pipeline (Offshore) Size Length (mile) 36" 216 Yadana offshore 36" 39 Yadana land 24" 126 Yetagun offshore 24" 42 Yetagun land Total

10 Gas Export to Thailand from Myanmar (BSCF Sr. YEAR YADANA YETAGUN TOTAL No / / / / / / TOTAL

11 Natural Gas Export by Pipeline Sr.No Russia Canada Norway Netherlands Algeria U.S.A U.K Germany Myanmar Argentina Turkmenistan Bolivia Indonesia Country Export Volume(BCM) Ref: BP s Statiscal Review of World Energy

12 Shwe Discovery in Block A-1 by Daewoo (in 2004) Location - Rakhine Offshore of Myanmar Type of contract - Production Sharing Contract Date of contract - August 4, 2000 Max Gas Flow Rate - 32 mmcfd (Shwe Well 1A 2004 Jan) Estimated Gas Reserves TCF 5.8 TCF The partners in A-1 and their interests A-1 A-3 - Daewoo (Operator, Korea) 60 % - ONGC Videsh (India) 20 % - Gas Authority of India Ltd. (GAIL) 10 % - Korea Gas Corporation (Korea) 10 % Partner in Block A-3 and its interest - Daewoo (Korea) 100% 12

13 Development Options for A-1 Natural Gas Reserves Liquefied Natural Gas (LNG) Plant (Size Options) Pipeline Gas to India (Route Options) Special Economic zone in Rakhine Region (Myanmar) 13

14 COAL RESOURCES, PRODUCTION & CONSUMPTION ( Million Tons ) ( Thousand Tons ) Coal Resources Sub-bit (Tamu) Sub-bit (Mawleik) Sub-bit (Kalewa) Recoverable Reserves Year Prod Cons Export Sub-bit (Pinluang) Sub-bit (Kyethee) Sub-bit (other) Lignite

15 ELECTRIC POWER SECTOR ELECTRIC POWER SECTOR ELECTRIC Installed Capacity (MW) Total ( Grid system + Isolated ) Percentage Hydroelectric % Gas Turbines % Steam Turbines % Diesel % % Steam Turbines 18.0% Diesel 3.6% Gas Turbines 38.8% Hydroelectric 39.6% Gas Turbines Hydroelectric Steam Turbines Diesel

16 CURRENT MARKAL ACTIVITIES IN MYANMAR

17 CLM ENERGY POLICY AND SYSTEM ANALYSIS PROJECT UNDER THE REGIONAL PARTNERSHIP SCHEME S ASEAN AUSTRALIAN DEVELOPMENT COOPERATION PROGRAM (RPS-AADCP) 17

18 PROJECT OBJECTIVES to enhance the capacity of CLM energy policy analysis and energy planning to assess the impacts and cost-effectiveness of alternative energy and technology options which could assist the CLM countries to formulate sustainable energy policy and programs to help meet the energy demand at least cost 18

19 PROJECT BACKGROUND Australian Managing Contractor -SMEC invited Myanmar to participate in EPSAP Project under the AADCP-RPS in September MYANMAR joined the Project with the shorthen time frame commenced late in September Letter of Agreement between Energy Planning Department,Ministry of Energy, Myanmar and ETSAP Primary System Coordinator - Decision Ware Inc in January ANSWER End User License Agreement signed between Energy Planning Department,Ministry of Energy,Myanmar and NOBLE-SOFT SYSTEM PTY,LTD,Australia in January

20 PROJECT ACTIVITIES The National Coordinating Committee and National Project Team were established in October 2003 comprising the members from the major energy sector in Myanmar (Oil & Gas Sector,Electric Power Sector, and Coal sector). The Project was commenced in late 2003 when Australian Coordinating Partner (ACP) conducted MARKAL training progeam for all CLM National Project Team members in Phenom Penh, Cambodia. 20

21 PROJECT ACTIVITIES(Contd (Contd) The main activities of program are listed below chronologically:, Basic MARKAL training conducted by the Australian Coordinating Partner(ACP).(November to december 2003). MARKAL Database design,data collection, database development and enhancement (January to April 2004). 21

22 PROJECT ACTIVITIES(contd (contd) Discussion and finalizing of the topic for national energy policy and report planning (June to July 2004). Further training over the period of Myanmar team member work attachment to the ASEAN Centre for Energy (ACE) during July

23 PROJECT ACTIVITIES(contd (contd) Formulate scenarios and cases for the policy analysis over the period from November through December Completion of model runs and draft report by January followed by report editing by ACE,ACP and reviewing by ABARE. 23

24 PROJECT ACTIVITIES(contd (contd) NATIONAL POLICY STUDY TOPICS The Topic chosen for the national policy study is: Self Sufficiency in Liquid Fuels-Option and Strategies The study was largely performed over a period of about 2 months from November through December The topic is considerable interest to Myanmar which is endowed with substantial primary energy resource in the petroleum and gas sector,but however is forced to import certain petroleum products. 24

25 IMPORTED CRUDE OIL AND PETROLEUM PRODUCTS Year Crude Oil Diesel Gasoline ( Million barrels 25

26 PROJECT ACTIVITIES(contd (contd) NATIONAL POLICY STUDY TOPICS Self Self Sufficiency in Liquid Fuels-Option and Strategies The index of self sufficiency is defined as: SS = ( Net domestic production ) ( Total domestic consumption ) or SS = ( Net domestic production - Export) ( Total domestic consumption ) 26

27 PROJECT ACTIVITIES(contd (contd) NATIONAL POLICY STUDY OBJECTIVE To achieve the SS = 100 % in the liquid Fuel by This Study attempts to find the options and strategies available for achieving this objective. 27

28 MARKAL MODEL AND DATABASE Cooking and lighting in the residential sector; Process heat (boilers) and electric drive (motors) in the industrial sector; Lighting and air-conditioning in the commercial sector; and Private car transportation, taxis and buses in the transport sector. 28

29 MARKAL DATABASE TECHNOLOGY Resource technologies covering primary energy supply, imports and exports; Conversion technologies, which for the ASEAN countries provide electricity generation, but can also include district heat; Process technologies where fuels are transformed into different products such as processing crude oil to produce refined petroleum products in an oil refinery; Demand technologies that are used by consumers to provide useful energy services such as an LPG or kerosene stove used in cooking. 29

30 SUPPLY OPTIONS FOR LIQUID FUELS EXISTING REFINERIES Sr. Name of Plant Capacity Process Plants No. ( BOPD ) 1. Thanlyin Refinery 26,000 Crude Oil Distillation Unit A,B,C; SBP Plant; LPG Terminal; Lube Blending Plant; Delayed Coker Plant; Candle Factory; Drum Manufacturing Plant. 2. Chauk Refinery 6,000 Wax Extraction Plant; Candle Factory. 3. Thanbayakan Refinery 25,000 Topper; Reformer; Delayed Coker Plant; Naphtha HDS; Kerosene Smoke Point Improving & LPG Recovery Units. 30

31 SCENARIOS AND CASES SCENARIOS Scenario BASE GPOLICY HIGHOIL LOWOIL OPTDIS PESSDIS TRSUB Description Myanmar Base Data (Crude 40$/bbl) Govt energy policy High crude oil prices (55$/bbl) Low crude oil prices (30$/bbl) Low discount rate of 7% High discount rate of 15% Allow fuel substitution in transport 31

32 CASE DEFINITIONS Table gives a list of cases defined for this study, by grouping different scenario sets. Table gives the scenarios included for each case. Case BASE BT BG BTG BTGH BTGL BTGO BTGP Description Myanmar Base Data (Crude 40$/bbl) Base, with fuel subst Base, with SS policy Reference case - Base, SS, with subst Reference, high crude price (55$/bbl) Reference, low crude price (30$/bbl) Reference, low discount rate (7%) Reference, high doscount rate (15%) 32

33 STATIC ANALYSIS THE REFINERY SECTOR the operation of a refinery can be classified under three categories: a) Uneconomical to operate or expand b) Economical to operate but not expand c) Economical to operate and expand. ame of Refinery Fuel Feedstock Cost ($/GJ) Refinery cost ($/GJ) Total cost ($/GJ) Output value ($/GJ) Category hanlyin xisting) Light crude Condensate ( c) ( c) hanbayakan xisting) Light crude Condensate ( a ) ( c ) hanlyin xpansion) Light crude Heavy crude ( b ) ( a ) ew refinery Light crude ( c ) 33

34 STATIC ANALYSIS THE TRANSPORT SECTOR Car transport (diesel, gasoline, LPG and CNG) Bus transport (diesel, gasoline and CNG) Truck transport (diesel and gasoline) Taxi transport (diesel, gasoline, LPG and CNG) 34

35 ANALYSIS OF RESULTS PRIMARY FUEL BALANCE Primary Fuel Balance Extraction Export Use ase Discounted Cost (M$) Crude Oil (PJ) Limit Actual Condensate (PJ) Limit Actua l Natural Gas (PJ) Limit Actual Nat. Gas (PJ) Nat. Gas (PJ) ASE 12,540 3,508 3,725 25,910 24,011 1,899 T 11,355 3,512 3,725 26,407 24,011 2,396 G 12,523 3,512 3,732 26,362 24,011 2,351 TG TGH 11,546 2,960 3,629 3,512 3,629 3,850 3,732 3,732 34,541 26,407 26,415 24,011 24,011 2,396 2,404 TGL 17,219 3,511 3,725 26,340 24,011 2,329 TGO 13,833 3,512 3,732 26,407 24,011 2,396 TGP 9,496 3,512 3,725 26,416 24,011 2,405 35

36 ACHIEVEMENT OF POLICY OBJECTIVE BY DIFFERENT CASES IN 2020 Achievement of Policy Objective (from 2020) ase Discounted Cost (M$) Total Dom.Supply (PJ) Total Export (PJ) Net Dom. Supply (PJ) Total Consumption (PJ) Self Sufficiency ASE 12,540 6,176 2,867 3,309 5,838 57% T 11,355 6,181 1,484 4,697 5,594 84% G 12,523 6, ,546 5, % TG 11,546 6, ,569 5, % TGH 2,960 6, ,539 5, % TGL 17,219 6, ,621 5, % TGO 13,833 6, ,576 5, % TGP 9,496 6, ,555 5, % 36

37 PETROLEUM PRODUCTS USED IN TRANSPORT SECTOR Consumption of (substitutable) Petroleum Products in the Transport Sector (PJ)- Case-BTG-Reference case - Base, SS, with subst Gasoline Diesel (ADO and IDO) Compressed Natural Gas LPG 37

38 CONCLUSIONS AND RECOMMENDATIONS Self sufficiency of liquid fuels starting from 2020 can only be achieved by allowing fuel substitution in the transport sector. Fuels in the order of the lowest to highest cost in the transport sector: 1. CNG 2. Gasoline 3. LPG 4. Diesel (car, taxi, bus and truck are transport sub-sectors) 38

39 CONCLUSIONS AND RECOMMENDATIONS It is highly desirable to implement the CNG conversion program to the maximum technical limit from 2010 and a LPG conversion program from 2020 if more condensate reserves cannot be utilized. The new refinery commissioned in 2020 has only the facility to process domestic crude oil. This can be concluded as a major limitation as it runs only at approx 50% capacity factor, exhausting practically all domestic crude oil reserves by An added flexibility of refining condensate in this refinery would be a definite advantage. 39

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