Total in Talks with Myanmar to Build Power Plant, Supply LNG

Total in Talks with Myanmar to Build Power Plant, Supply LNG

Total SA is in talks with Myanmar to supply the country's most populous
city, Yangon, with liquefied natural gas.

The French energy giant may also build a power plant, according to Xavier
Preel, general manager of Total E&P Myanmar. Total, which sold about 11
million tons of LNG last year, is seeking to expand its footprint in
downstream activities like regasification terminals, pipelines and power
plants to help create new gas demand as it refocuses away from oil.

"We are quite confident that Myanmar will develop in a big way," Preel said
in an interview this month in Yangon. "This is for the time being, under
discussion. We proposed to the government to bring LNG and build a power
plant."

The push by Total into downstream operations underscores the concern of
global LNG producers as they try to lure new buyers to sop up excess supply
that has depressed prices about 70 percent since 2014. Qatar announced this
month plans to boost its annual LNG production to 100 million metric tons
within seven years from 77 million tons now, adding to concern among
explorers an oversupply may extend well into the next decade.

Creating new demand for gas is crucial and Total has been asked to construct
gas-fired power plants in "some emerging countries," Senior Vice President
for Gas Laurent Vivier said at the World Petroleum Congress in Istanbul this
month. Chief Executive Officer Patrick Pouyanne said in April of 2016 the
company was exploring a project in Indonesia where it could invest in gas
pipelines and an independent power plant.

A Total spokeswoman in Paris declined to comment or offer additional details
about the LNG terminal and power plant project mentioned by Preel. Calls to
spokespersons at the Myanmar Ministry of Electricity and Energy weren't
immediately returned.

Myanmar, which ended 25 years of military rule in a 2015 election, had
electricity consumption of about 217 kilowatt hours per person in 2014,
according to data from the World Bank and the International Energy Agency.
That's less than a tenth of the amount of power consumed per capita in
neighboring Thailand.

Myanmar issued a request for expressions of interest for an LNG business on
Sept. 9. The country will solicit bids for a $2 billion project that
includes a floating LNG terminal with an annual capacity of 3-4 million tons
and a 1-gigawatt gas-fired power plant, the Nikkei reported in March, citing
a government source it didn't identify.

The Southeast Asian nation is seen as a bright spot for energy markets. BMI
Research forecasts fuel consumption growth over the next decade as the
stabilizing business and political climate foster growth in energy-intense
sectors like transportation and manufacturing.

Total, which has been operating in Myanmar since 1992, already produces gas
from the Yadana field in the Andaman Sea off the country's west coast that
meets about half of its gas needs, according to the company's website.

"Access to electricity is the most important economic factor in Myanmar,"
said Preel. "Myanmar needs a lot of energy for the development. There is no
economic development without energy."

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Link to Original Article:
https://www.bloomberg.com/news/articles/2017-07-20/total-in-talks-with-myanm
ar-to-build-power-plant-and-bring-lng

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com