China Oil and Gas Pipeline Project to Power Myanmar Economy after Full Operation

An oil tanker with a capacity of 300,000 tons docking in the Port of Maday Island on January 30, 2015 [Photo: courtesy of PetroChina Myanmar]

The economy of Myanmar is expected to see a boost from an oil and gas pipeline project linking the country to China.

The authorities in the south-east Asian nation have now given the go ahead for the oil division of the Myanmar-China Oil & Gas Pipeline Project.

The move comes just days before the first official visit by Myanmar's president to Beijing since taking office a year ago.

CRI's Myanmar correspondent Tu Yun reports.

More than two years after the oil pipeline's completion, Myanmar's energy authority has finally given PetroChina, the operator of the project, the approval to put it into use.

The Myanmar-China oil pipeline is part of the 2.5-billion-dollar Myanmar-China Oil & Gas Pipeline Project, which also comprises a natural gas pipeline that's been in operation since July, 2013.

"To my knowledge, the Myanmar-China Oil & Gas Pipeline Project is the only major mature project of its kind in Myanmar."

Wang Guanghui is the manager of the project's Mandalay Operation Center.

"Our current users are mainly Myanmar local steel mills, power plants, and glass mills. In the case of the Mandalay off-take station, the downstream users are a glass factory and a natural gas generator plant."

The Myanmar-China gas pipeline starts near Kyaukphyu in western Myanmar's Rakhine State, and runs through its central region of Mandalay, northern towns of Lashio and Muse before entering China's southwestern province of Yunnan.

Under the deal signed between PetroChina and the Myanmar authorities, the gas pipeline carries natural gas from Myanmar's offshore fields to China with an annual capacity of up to 12 billion cubic meters, of which a maximum of 20 percent is provided to users in Myanmar.

"A number of foreign companies have set up natural gas power plants in Myanmar; they will be using natural gas carried by this pipeline in the future."

As the country has a nearly-300-megawatt gap between supply and demand for electricity, the Myanmar-China gas pipeline is expected to help bridge that gap once those power plants are put into operation.

As for the oil pipeline, which runs in parallel with the gas pipeline, it will have an annual capacity of 22 million tons of crude oil, with nearly 10 percent, or 2 million tons, being used in Myanmar, almost double the country's annual oil production.

The crude oil carried by the Myanmar-China pipelines is imported mainly from the Middle East.

A signing ceremony for the official operation of the oil pipeline is scheduled to be held in Beijing in some ten days during Myanmar President Htin Kyaw's upcoming China visit.

For CRI, I'm Tu Yun reporting from Yangon.