VIS had a major participation in the implementation of this key study, that was contracted to e.Gen by the World Bank, aimed at assessing the economic costs of supplying natural gas to Myanmar’s domestic market. This was the first IFI funded study to have been undertaken in Myanmar in the gas sector. VIS provided the Senior Energy Economist, in the three expert project team, who led the implementation of two of the three components of the study.
VIS evaluated multiple approaches for determining the economic cost of supplying natural gas, including Cost Plus, Short Run Marginal Cost, and Long Run Marginal Cost methods, to determine the most appropriate for Myanmar’s context. VIS assessed Myanmar’s current and forecasted gas supply, considering current and planned gas reserves and exploration/production plans, gas exports and commitments arising from Production Sharing Agreements (PSAs). We developed bottom-up gas demand forecasts, by customer type and location, and assessed gas supply sources and projected supply volumes. We identified demand-supply gaps in future, and proposed options to address these, including re-allocating gas exports from certain fields to supply the domestic market, as well as increasing gas supply via LNG imports. A pre-feasibility and cost benefit analysis of LNG imports was also undertaken.
VIS developed a customized gas costing model, incorporating demand, supply, operating costs and capex throughout the supply chain, including transmission reinforcement/expansion investments. We calculated economic costs of supply, from production/import point to major off-take points supplying domestic customers (industry and residential). The gas costing model with a user manual were delivered to the Myanmar Government to inform future policy decisions.
The study findings, including the economic costs of supply and its recommendations on supply options., were presented by VIS in an international conference in Myanmar, attended by the the Ministry of Petroleum and other Ministries, the World Bank, IFIs, international oil and gas majors, and other stakeholders.