On September 13th, VDB Loi participated in the 5th Euromoney Myanmar Global Investment Forum in Nay Pyi Taw. Edwin Vanderbruggen was featured as the keynote speaker on the electricity panel, which addressed a number of concerns among the business community in this rapidly expanding sector.
Amongst investors’ questions were which power sources are the most viable for Myanmar’s growing electricity demand. Although coal is recommended as a source of power for the country, so far, no coal-fired projects have yet been approved. In addition, many hydro-power projects in the country have been delayed because of social and environmental factors. However, where many analysts see impediments, others see potential. Mr. Vanderbruggen offered a tangible strategy moving investment forward in Myanmar’s power sector, as reported in the Myanmar Times:
“We can buy LNG to power up the infrastructure here and do this for ten years, and once domestic gas production is up again, we can just stop buying LNG and switch to the natural gas that we have produced.”
He went on to explain that major oil companies like PTT, Shell and Total, among others have initiated negotiations with the government concerning several LNG project tenders.
Another question from participants involved the next round of Power Purchase Agreements (“PPAs”). As the last round of PPAs were approved in March 2016, investors have been closely watching for new approvals as a green light to enter the market. Voicing his optimism about both the government and private sector’s plans to move forward, Mr. Vanderbruggen said, “By this time next year we will have at least two new PPAs or I buy everyone here a beer.”
The panelists concluded in agreement that the power sector, and LNG in particular, are still in their beginning stages and with the massive demand for electricity increasing with Myanmar’s rapid development, the government must move quickly with foreign investors to keep pace.