Thai PTT to open first Myanmar filling station next year

PTT Oil and Retail Business, the retail arm of Thai energy giant PTT Group, said it intends to form a joint venture with KBZ Group to set up a filling station and a reserve facility.

“The first PTT station in Myanmar is slated to open before the second quarter of next year,” said Buranin Rattanasombat, vice president of PTT Oil and Retail Business, which includes gas stations, coffee shops and convenience stores.

Having set up around 300 PTT stations in Cambodia, Laos and the Philippines, the Myanmar market is now the focus, Mr Rattanasombat added.

With the approval from the Myanmar government, PTT and KBZ Group will build a liquefied petroleum gas (LPG) and oil reserve facility besides a filling station. The reserve facility is estimated to be completed within a year.

“Since Myanmar has no oil refinery, we hope that this project will serve as a fuel storage centre to handle the delivery and quality control of PTT products that will come by sea from Singapore and by land from Thailand,” said Mr Rattanasombat.

Storage depot, logistics port and gas packing factory are all planned in the new reserve facility located in Yangon. With a storage capacity of 1 million barrels of oil and 4500 tonnes of LPG, PTT expects it to be the largest oil and gas reserve in Myanmar.

The Thai conglomerate is the second foreign investor after PetroChina International to enter Myanmar’s fuel station market.

The Chinese state-run oil major launched its first service station in Myanmar last March through a joint venture between its Singapore unit Singapore Petroleum Co (SPC) and Shwe Taung Energy Co, a subsidiary of Shwe Taung Group.

At the time of the launch, Shwe Taung said it plans to bring in all of its 18 outlets under the SPC brand.

The Myanmar Investment Commission (MIC) opened up the retail energy sector in 2017 to foreign investors but liberalisation has largely fallen flat.

Max Energy and Shell inked an agreement in July 2017 to operate Shell-branded petrol stations, which is yet to happen. Singapore-based Puma Energy also plans to set up 50 franchises within a decade but no announcement has been made since.

State intervention might explain the reluctance for foreign investors to come in. It has been difficult for non-Myanmar companies from operating fuel stations. At the same time, the regional government leases land at prime locations with a much cheaper price to local and private Yangon Petrol. The regional government’s practice was branded by some private players as “anti-competitive”.

Myanmar has seen a significant increase in the number of service stations since the government allowed private investment into the industry in 2010. The total number of privately-owned stations is now 2445, according to data updated in March from the energy ministry.

Source: Myanmar Times

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