Malaysia’s state energy company Petronas had said in a statement it would deliver the cargo directly to Myanmar, giving rise to rumours the tanker would be headed from Bintulu LNG in Malaysia’s eastern state of Sarawak to the port of Yangon. Instead, it did berth directly at the new jetty and regasification unit, built just meters from the gas-fired Thanlyin power plant (see map).
The maiden cargo is the first of a series of LNG deliveries from Petronas to CNTIC and VPower Group under a sale and purchase agreement, signed in early 2020 to ensure a stable fuel supply for three new gas power projects in Myanmar.
A second cargo, loaded the tanker Golar Kelvin, left Bintulu LNG on Thursday last week, according to ship tracking data. However, it is unclear when it will arrive at Thanlyin given that the tanker with the maiden cargo had been waiting in the Gulf of Martaban off Myanmar’s coast for almost a month before entering Thilawa port, the site of Thanlyin LNG.
Delayed cargo delivery slows down power project
CNTIC and VPower Group are fast-tracking construction of the 350 MW power plant in bid to avoid the recurrence of blackouts this summer. According to the government tender notice, developers were given seven month to complete the project but commissioning is now running two month late – possibly due to the delayed delivery of fuel.
The tender initially envisaged to source gas for the Thanlyin power plant via a floating storage and regas unit (FSRU), with electricity meant to be generated on floating power barges at Thilawa port.
Later, that plan was changed to an onshore, engine-based power unit with an associated floating storage unit (FSU). The Thanlyin consortium consequently resorted to importing LNG via small LNG carriers with a shallow draught that can transport the cargo directly to the jetty and offload it onto the FSU.
Emergency power projects meant to mitigate risk of blackouts
Swift start-up of the Thanlyin LNG-to-Power is vital to avoid a repeat of power shortages, and potential blackouts. During the past summer, the Yangon area of the country was subjected to power cuts of up to six hours a day and World Bank warned the country’s electricity demand is growing three times as fast as available capacity.
With general election coming up in November, the government wants to avoid a repeat of the dire situation of blackouts this year; hence it launched tenders for three emergency power units. Once up and running, these Wärtsilä engine-driven gas power plants can operate baseload or in load-following mode to provide balancing power for Myanmar’s rising share of wind and solar power.