Royal Dutch Shell plc recently entered into an agreement with Thailand-based companies to develop a liquefied natural gas (LNG) terminal at the Dawei special economic zone in the Tanintharyi Region in Myanmar, says local daily Myanmar Times.
The firm has signed a Joint Development Agreement (JDA) with Thai companies Italian-Thai Development and LNG Plus International in Bangkok on August 19 to cooperate on developing the terminal.
It will consist primarily of an LNG receiving and re-gasification terminal at Dawei special economic zone. The LNG will be sold through Myanmar and Thailand.
“We believe that this opportunity will enable Shell, together with its partners, to bring its global expertise in LNG to Myanmar meeting the country’s energy aspirations,” Roger Bounds, Shell's vice president of Global LNG said, as quoted by Myanmar Times.
LNG is natural gas with has been condensed by cooling it to at least -162 degrees Celsius (-260 Farenheit), which reduces its volume to about 1/600th the size. This makes it much easier to transport by ship.
The plan is for the LNG terminal in Dawei to serve as a place for offloading LNG for on-shipping to various businesses in Dawei, Thailand and eventually the rest of Myanmar, cutting out a requirement to ship south around Singapore.
According to Myanmar Times, the JDA is the first major LNG business transaction in Myanmar. Foreign companies from the region, including China, South Korea, Japan, India, Singapore and Thailand, have also held discussions with the Myanmar government to develop the LNG facilities.
Myanmar is a major producer of natural gas. However, it may have to import the fuel in the medium term, as much of its production is contracted out to Thai and Chinese buyers, while Myanmar is planning a number of new projects such as electricity generation that requires natural gas.