Myanmar Energy Industry Set for Technological Revolution

One of the world's oldest oil producers, Myanmar is sitting on an estimated 50 million barrels of oil and holds around 7.8 trillion cubic feet of proven natural gas reserves, according to BP Plc data, and is worth around $75 billion. Its potential is reflected in recent foreign investment which, as of July 2013, marks 14.372 billion U$S in 115 projects. It is unsurprising, therefore, that Myanmar is fast becoming a leader in the Asian Oil and Gas market.

Whilst in the past, Myanmar's Oil and Gas industry has suffered from insufficient foreign investment, a number of recent political reforms has fostered foreign investors' interest. Measures include government plans to reduce the income tax rate by 5% and extend the three-year tax holiday to five years, the launch of a series of licensing rounds and the issue of production-sharing contracts. With these reforms, comes a growing consensus that Myanmar is one to watch, particularly as an oil and gas power. Myanmar has even been rated by some experts amongst the world's top five oil and gas hotspots.

Melinda Tun, at Baker & McKenzie argues that: 

“People see Myanmar as a frontier market [...] “If you can get a first-mover advantage you could be well set for years to come.”

According to T.K. Ananth Kumar, Oil India's Finance Director, “The potential gas reserves could be much bigger than what is known [...] “In the long-term, we need to be in Myanmar. It’s one of the last Asian countries opening up.”

Nevertheless, Myanmar's technical capacity and expertise remains under-developed. To reach its full potential, Myanmar must experience a technological revolution. This substantial demand for the latest technology and industry solutions will be addressed at the 3rd annual Oil & Gas Summit 2014, the largest Oil&Gas Exhibition in Myanmar. The Summit will be co-hosted alongside the extremely popular Myanmar Power and Electricity Summit 2014 on 27-28 January. The 2-day event will bring together some of the world's leading industry players to discover the latest investment opportunities, industry developments and strengthen industry ties. 

For further information on the Myanmar Oil & Gas and the Myanmar Power & Electricity Summit contact: charlotte@oliverkinross.com or click here

"More Jakarta, less Geneva"

Indonesia is South-East Asia's largest economy and, arguably, one of the most promising. Lying not far behind from emerging economies Russia and China, Indonesia “has been showing continuous robust macroeconomic growth for almost a decade”, having fully recovered from the Asian Financial Crisis of the late 1990s.

Australia's recently elected Prime Minister, Tony Abott, promised '"more Jakarta"'/'"less Geneva"' in his election campaign and as been delivering, making Indonesia his foreign visit since taking office. The Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) aims to facilitate and encourage trade between the two nations. Foreign powers would be well advised to follow suit. Whilst Australia is clearly keen to develop bilateral relations with Indonesia, and has been taking positive steps to do so, it remains clear that many foreign investors are yet to discover the true economic potential of this rising power, Indonesia.

According to the Indonesian Petroleum Association, in the Asia Pacific region, Indonesian oil production is second only to China, and its gas production is second to none. Lukman Mahfoedz, president of the Indonesian Petroleum Association and CEO of Medco Energi, the country’s largest private oil-and-gas firm, believes that the Indonesian Oil and Gas Industry, worth almost $70 billion annually, needs the expertise and capital of foreign firms to realise its full potential. Whilst foreign investors may have been spooked by recent events, including corruption scandals and accusations of resource nationalism, Indonesia's president, Susilo Bambang Yudhoyono, has proposed fiscal incentives to aid firms in covering deep drilling and enhanced oil recovery costs, suggesting that he too wishes to encourage foreign investors. Vowing to cut bureaucracy and improve '"clarity, certainty and consistency (in the legal framework)"', he has set up a task force to come up with initiatives to incentivise investment in Indonesia's Oil & Gas sector. 

The Indonesia Energy, Oil & Gas Summit 2014, 20th & 21st March, being held in Nusa Dua, Bali,  is the perfect platform to explore the latest investment opportunities within the Indonesia Energy and Oil & Gas industry, and discover the latest regulatory changes, technological advancements, innovations and techniques. Click here for further information.

Africa Security & Counter-Terrorism covered

International Defence companies are said to have begun targeting Africa markets…What do we attribute that to?

The recent energy boom in Africa has been one of the main contributors to the huge increase in spending, military spending is expected to exceed $20 billion in the next 10 years in Africa. Terrorism and and security issues is not confined to national borders. Somalia’s security problems, for instance affect Uganda, Ethiopia and Kenya, whilst North Africa Security Issues can have significant global implications.

The rise in security issues and terrorist attacks over the last few years have encouraged many countries to adopt a more vigorous strategy when dealing with security issues. The US and EU defence markets are suffering from drastic spending costs. It has long been argued that instability hinders Africa's continued success development.

We are seeing a turn around in African states (beginning to take a serious stance on security) are they doing enough? What more needs to be done?

Terrorism is constantly evolving in Africa, the state strategies and solutions need to be developing year by year to combat the challenges.

I think now it is a case of bringing together state police, the government and the people of Africa to work together to tackle these issues. Then International companies come in with their technologies and expertise and it can

Nigerias president Goodluck Jonathon has proposed for International cooperation to help combat terrorism,

The African states need to meet with international service providers to and technology companies to find out what they have to offer and how the state can respond to terrorism threats and security issues.

TheAfrica Security and Counter-Terrorism Summit( what is it all about)

The Africa Security and Counter-Terrorism Summit 2014 will assess the most pertinent security issues affecting Africa’s Governments and people. Over the two-day conference talks will examine key threats and challenges and look at the most cutting edge technologies available to governments for use in a wide range of environments.

The current nature of global conflict and the array of threats currently facing African Nations requires new solutions and a pooling of ideas to form a comprehensive and conclusive response. The Africa Security and Counter-Terrorism Summit 2014 is an exclusive opportunity for international security professionals to meet, discuss and learn about one of the world’s fastest developing regions.

This event will include a two day conference including extensive presentations on all aspects of the African Counter-Terrorism and Security spectrum, an exhibition where the world’s leading companies meet to engage their key audience, and a networking evening where delegates can relax, network and form valuable business relationships. All attendees will leave with lasting knowledge of Africa’s security issues and a wealth of new contacts in one of the most important regions on the planet.

Various Africa states are facing a major challenge in attempting to contain the threat of terrorism. The challenge lies in the lack of resources and training necessary to strengthen the country’s capacity to respond effectively…Will this conference provide solutions as to what direction should be taken to counter these challenges.

We will be bringing all of the ministers of defence to the conference, as well as major international solution providers, this will give the ministries a chance to learn of the latest and most developed solutions for the terrorism and security issues.

As well as the chance to network, the conference will be covering some of the latest issues such as;

• Africa & The global security context
• Crowd and riot control
• local counter-terror strategies
• Piracy and Kidnapping
• New security technologies
• The fight against terrorism: North Africa
• protection of oil and gas pipelines in Africa

Some of our speakers include:

• Head of INTERPOL Regional Bureau Harare/ SARPCCO Coordination Office
• Lt Gen Mwaniki , who is a former Kenya Army commander/ Current Commandant National Defence College
• Tony Smith, UK Border Force CBE Former general Director of the UK Border Force
• Chatham House Alex Vines, OBE Research Director, Area Studies and International Law; and Head, Africa Programme
• The European Centre for Information Policy and Security ( ECIPS ) Ricardo (Baron) Baretzky President

Africa Healthcare Boom

The healthcare industry is set for huge growth across the world over the next coming years, particularly in Africa. The economic boom in many African countries has fuelled demand for improved healthcare. As governments try to meet demand and begin to implement universal health schemes, and the Africa sector undergoes “major policy, system and infrastructural changes”, investor opportunities are increasing tenfold. And as technology continues to develop within the region, the healthcare industry will only continue to expand. The expansion of Samsung Electronics into the South Africa healthcare sector is just one example.

There is no doubt that investors can expect strong returns. According to Valter Adao, Deloitte, “outlook for investments in the healthcare sector remains relatively robust compared to other sectors”. And although "global mergers and acquisition trends remain subdued due to the economic environment with a move towards smaller deal sizes, the healthcare sector bucked the trend somewhat in the second half of 2012 with a 4% increase in deal value". 


It is estimated that, by 2016, Sub-Saharan Africa’s healthcare market will rocket to $35 billion. Fedré Meiring, Associate 

Director of the Corporate Finance Division of Deloitte posits that:

“The healthcare sector appears to be well placed to take advantage of both the expected growth on the African continent and the

 relatively high proportion of global disease in Africa”.

According to the WHO,

 “The Sub-Saharan region alone accounts for 11% of the world's population and bears 24% of the global disease burden.”

One major effect of the boom on the Africa healthcare sectors was the rise in demand for private healthcare. The burgeoning middle classes can afford, and are willing to pay for better treatment. This is an incentive like never before. Often in partnerships with governments, the private sector is improving healthcare facilities, affordably.

Across the region, governments have implemented a number of promising reforms, restructuring their nations' health systems, in turn facilitating access to free universal healthcare.

Undeniably, however, in some countries, progress has been stunted by major economic and political challenges, poor infrastructure and a lack of suitably trained medical professionals. But reform is possible. Ethiopia has begun building an improved primary healthcare service and South Africa has launched the National Heath Insurance Pilot Project.

The Africa Healthcare Summit 2014, 20-21 February, being held in London, is the perfect platform to explore the latest investment opportunities within Africa's healthcare industry and discover the latest regulatory changes, technological advancements, innovations and techniques. Click here for further information.

Asia – The New Middle East?

As demand for Oil and Gas imports in the U.S. falls, many are searching new horizons to export to, and many are turning towards the Asia – Pacific Market¹.

There is no denying that Asian oil consumption will continue to rise for years to come. China recently signed a contract for 400,000 Mcf/day gas from the deep-water Shwe project in the Bay of Bengal to be delivered via the Myanmar/China pipeline².

Energy demand is projected to almost double in the region by 2030, not only will Asia continue to import oil and gas, but also produce substantial quantities. Some would argue that Asia is beginning to overtake its less stable Middle East counterpart.

IOC's have been quick to snap up exploration blocks within the region. Indian Oil Ltd is currently exploring the available opportunities to expand into Asia³. Myanmar in particular offers a number of investment opportunities. Despite being one of the world's oldest oil producers, Myanmar's upstream sector is largely underdeveloped. Yet, with 10 million cubic feet of Natural gas to offer and another 50 million barrels of cruide oil, many IOCs are optimistic⁴. 

Myanmar frequently holds offshore licensing rounds, in April-June this year, 61 oil and gas companies pre-qualified. The list of pre-qualified companies included international majors such as ExxonMobil, ConocoPhillips, Shell, Total, Statoil, Eni and Repsol. A further 18 onshore blocks will be awarded in December 2013. It is clear that since US sanctions were lifted and President Thein Sein took power, investor opinion has improved considerably ⁵.

The latest investment opportunities will be examined at the Asia Oil &Gas Awards 2013 ceremony which will be hosted alongside the 2-day Asia Offshore Oil and Gas Summit and the Bay of Bengal & Andaman Sea Oil and Gas Summit 18-19 November 2013 in Bangkok. These two unique events will bring together some of the world's leading industry professionals, including Energy ministers, Senior Oil and Gas company representatives, Contractors, Service Companies and Solution Providers. A number of awards will recognise, for instance, Exploration & Production Company of the Year, Local Content Initiative of the Year, CSR Initiative of the Year, Drilling & Well Services Company of the Year and Oil & Gas Logistics Company of the Year.

Keynote speakers include: Dr. Pyasvasti Amranand, Former Minister of Energy and Mineral Resources of Thailand & Chairman of the Energy for Environment Foundation; Dr. Siri Jirapongphan, Executive Director, Petroleum Institute of Thailand (PTIT); Dr. Andrzej Bolesta, Economic Counsellor, Embassy of the Republic of Poland in Bangkok; Michael Mcwalte, Petroleum Advisor to Governments of Cambodia and Papua New Guinea; U Naing Maw Than, Vice President, Myanmar Geologists Society, Singapore (MGSS) and Chris Faulkner, CEO, Breitling Energy, plus many more!

1 http://www.theglobeandmail.com/report-on-business/breakthrough/the-race-to-ship-liquefied-natural-gas-to-asia/article13260357/

2http://blogs.platts.com/2013/08/05/china-gas/

3http://www.dnaindia.com/money/1870440/report-ioc-plans-to-expand-in-asia-africa-eyes-upstream-projects

4http://www.rigzone.com/news/oil_gas/a/127412/Myanmar_Prepares_Ground_to_Boost_Upstream_Oil_Gas_Investments/?pgNum=1

5http://www.platts.com/latest-news/natural-gas/singapore/myanmar-to-award-offshore-blocks-in-2014-onshore-27251698

Caribbean Oil-Rush

Since its implementation in 2005, the Caribbean region has benefited enormously from the Petrocaribe scheme. Under the initiative, member countries, such as Jamaica, Cuba, Antigua and Barbuda, Nicaragua and Honduras, were permitted to pay 40% of Venezuelan oil imports within 90 days and pay the remaining 60% at low annual interest rate of 1% over a 17-25 year period.

Since Hugo Chavez's death, however, the future is not so rosy. The present incumbent, Nicolás Maduro, recently increased the 1% interest rate to, in some cases, as high as 4% ¹. Venezuela is undoubtedly one of the region's largest creditor. Last year, Jamaica was estimated to owe Venezuela around $2.4 billion for oil. While, according to Bloomberg, some have estimated that 35% of external Caribbean debt will be owed to Venezuela by the year 2015².

In response, many Petrocaribe members have begun to look for alternative energy options on the home front, in the realisation that continued membership to the scheme would be unsustainable. Dr. Victorio Oxilia, The Executive Secretary of the Latin American Energy Organisation (OLADE), recently highlighted the issue, when he underscored the importance of Latin American and Caribbean beginning to import less and export more oil³. With many others also question the benefits of Petrocaribe and the economic dependence it forces upon its members, the selling of licensing rounds has seen a huge rise after a number of Oil and Gas finds in the area. Currently one of the world's main LNG exporters, Trinidad and Tobago are now looking to boost oil production, and have more than doubled their Oil and Gas activity since 2010. Zac Phillips, an analyst at Fox Davies, claims that Trinidad and Tobago have revitalised their energy industry much like Nigeria and the UK's industries⁴. Energy Minister, Kevin Ramnarine, plans to increase production from 90,000 barrels/day to 120,000 barrels/day by the end of next year, 2014⁵.

A number of international companies have expressed their interest in investing in the Caribbean Oil & Gas industry which holds 20% of the world's total oil reserves. This July, Repsol began negotiations for a contract with Nicaragua to begin exploration in Bluefields Bay. Whilst many multinationals, such as BP, Parex Resources, Niko Resources, Centrica and Noble Energy, have already invested heavily in the region. Lee Hunt, consultant and former president of the International Association of Drilling Contractors, was not wrong when he commented that:

'"What once was a trickle is fast becoming a stream in the Caribbean, with new announcements of expanding deep-water exploration lease offerings and drilling permits being issued"' ⁶.

In order to encourage and facilitate international investment, the 2-day Caribbean Oil, Gas & Power Summit in September 2013, will bring together some of the world's leading industry players, including Energy ministers, senior Oil and Gas company representatives, Contractors, Service Companies and Solution-providers, to discover the latest investment and business opportunities and strengthen industry ties.

1http://latino.foxnews.com/latino/money/2013/07/03/with-chavez-gone-caribbean-nations-no-longer-benefit-from-venezuela-cheap-oil/

2 http://www.bloomberg.com/news/2013-05-26/caribbean-should-trade-venezuelan-oil-for-homegrown-sun.html

3http://www.noticel.com/noticia/145227/latinoamerica-y-el-caribe-el-reto-de-importar-menos-derivados-de-petroleo.html

4http://www.caribbeannewsnow.com/topstory-Significant-increase-reported-in-Trinidad-oil-and-gas-industry-activity-15880.html

5 http://www.sharesmagazine.co.uk/articles/explorers-seek-treasure-in-the-caribbean-islands#.Ue0zdo0sk-o

6http://bigstory.ap.org/article/caribbean-nations-search-oil-amid-spill-fears-0

Russo-Asian Politics

Not only is Asia fast becoming a major player in the Oil & Gas industry, it is already a major consumer, and Russia is keen to increase its exports of coal, oil, gas, gold and copper from East Russia to the Asian market. In fact, so eager is the Russian government to encourage energy trade links with Asia, that it has begun to offer fiscal incentives to those companies involved in the development of infrastructure in east Russia to facilitate resource exports. 

Moreover, Russia will, for the first time, allow other Russian companies to export LNG to the Asian market, breaking Gazprom's monopoly. This will allow more Russian natural gas to be exported further, since natural gas in its liquid form no longer has to be transported by pipeline. Mr. Dvorkovich explained that although Russia would continue to deliver gas to Europe, Russia sees greater prospects in Asia. 

According to Russian officials, this pivot has resulted, in part, because of increased  regulatory pressures in the European market, combined with falling European demand. Having signed a number of gas supply deals with China, it is clear that for Russia, future successes lie in Asia. The biggest deal to date, estimated at around $270 billion, CNPC (China National Petroleum Corporation) made a pre-payment to Rosneft of around 70 billion in return for a supply of 365 million tons of oil over 25 years. 

Russia have also signed a new deal with Japanese Sakhalin Oil and Gas Development Company and the Japanese trading firm Marubeni. The Diplomat hails this as the start of energyand political relationship between the two nations.