Resources to Myanmar
Trends and opportunities
As Myanmar embarks on the process of economic development, significant investment is expected to occur in resources, infrastructure and agriculture. The development of Myanmar’s resources will create opportunities for Australian companies, both as potential investors in mining and oil and gas projects and as suppliers of related goods, services and technology.
The oil and gas sector is already a significant source of foreign investment and revenue for the government, particularly through offshore production in the Bay of Bengal and the Andaman Sea. Natural gas from these projects is exported via pipeline to Thailand and China and is also used to generate electricity for domestic consumption. Exports of natural gas increased by nearly 70 per cent to 7.7 trillion cubic feet in the 12 months to September 2013 and were valued at US$3.6 billion, almost 40 per cent of Myanmar’s total exports (Source: Asian Development Bank, Asian Development Outlook – Myanmar, 2014, 6 Feb 2015).
With new projects coming on stream in the next few years and an additional 16 onshore and 20 offshore exploration blocks awarded since October 2013, this sector will be a major driver of economic growth and a focus for Australian companies. Four Australian companies were involved in consortia that were awarded six of the offshore blocks announced in March 2014 (Source: OilOnline.com, Myanmar announces offshore licence winners, 6 Feb 2015). As these blocks are developed, opportunities will emerge for Australian suppliers of equipment, technology and services, particularly for offshore projects.
Myanmar’s mining sector is not as developed as oil and gas and there is a much lower level of foreign investment in place. However, the country has extensive mineral resources and these are attracting considerable interest from international mining companies.
The government is considering reform of the country’s mining law, which should result in greater certainty and transparency for foreign investors. This in turn would act as a catalyst for a significant increase in investment in the mining sector. Opportunities are expected for Australian mining and METS companies to participate in the development of this sector once the legislative reform process is complete.
Myanmar is strengthening and updating its regulatory framework to support the environmentally and socially sustainable development of its natural resources. The government has indicated a strong preference for responsible foreign investment that will contribute to the achievement of this objective.
Opportunities exist for Australian companies in the following areas:
- Technology and equipment for the oil and gas sector (onshore, shallow water and deep water).
- Mineral exploration and processing – greenfield and brownfield projects:
- Gold, silver, copper, tin, tungsten, antimony, coal, iron ore etc.
- Industrial minerals – limestone, decorative stone, barite etc.
- Mining technology and equipment.
- Environmental and related technology and services.
Local companies are active in the mining sector, but often lack access to modern technology and practices. Mining is still predominantly small scale, labour intensive and lacking in basic environmental and safety measures. Foreign investment in the mining sector is very limited, but this is expected to change once the mining law reform is implemented.
The oil and gas sector is more advanced with a number of existing international producers including:
- Total – France.
- PTTEP – Thailand.
- Petronas – Malaysia.
- Daewoo – Korea.
Significant investment is expected from major global companies following recent bidding rounds for onshore and offshore blocks. The successful bidders were announced in October 2013 and March 2014 respectively (Source: Global Witness, Who are the real winners of Myanmar’s latest oil and gas block sales?, Jun 2014).
Low cost products are available in Myanmar, but their quality and reliability can vary. Some major international equipment suppliers and contractors are establishing a presence. Demand is expected to increase for higher tech, higher quality products that offer greater reliability and comply with international standards.
Tariffs, regulations and customs
Myanmar is a member of the ASEAN Australia New Zealand Free Trade Area (AANZFTA). Reflecting its lower level of economic development, Myanmar’s commitments to reduce tariffs under AANZFTA are being phased in at a slower rate than other parties to the agreement. Tariffs on most items are scheduled to begin reducing in either 2015 or 2020. Visit ASEAN tariff finder for specific products.
Myanmar is in the process of finalising its environmental standards for extractive industries. The government is encouraging investment from foreign companies that will bring international best practice in terms of exploration, production and processing.
Marketing your products and services
For suppliers of technology and equipment, local agents or distributors with specialist industry knowledge and established networks are generally the preferred way to build market contacts. As well as navigate regulatory and procurement processes, and identify emerging opportunities.
There are a number of trade exhibitions specific to the oil and gas and mining sectors in Myanmar each year. These can be a useful way for Australian exporters to raise awareness of their product offerings. These include:
Austrade Yangon is able to provide additional information on specific resource sectors and can help to identify potential local partners for interested Australian companies.
Most imported products arrive in Myanmar by sea through Yangon port, Myanmar’s busiest port. Road transport overland from neighbouring countries, particularly China and Thailand, is possible but the road systems are generally poor and road freight rates can be very high.
Myanmar has three main international airports: Yangon, Mandalay and Nay Pyi Taw. A new international airport in Hanthawaddy, about 80 kilometres northeast of Yangon, is in the early stages of planning.
Myanmar now has direct air connections with most countries in East Asia, with most of these connections being into Yangon.
Links and industry contacts
Ministry of Mines
Department of Mines
Department of Geological Survey and Mineral Exploration
Ministry of Environmental Conservation and Energy
Department of Environmental Conservation
Directorate of Investment and Company Administration
Myanmar Investment Guide
Australia-Myanmar Chamber of Commerce
Myanmar Engineering Society
Myanmar Federation of Mining Associations
Myanmar Geosciences Society
Union of Myanmar Federation of Chambers of Commerce and Industry
Austrade’s ASEAN tariff finder
Please note: this list of websites and resources is not definitive. Inclusion in this list does not imply endorsement by Austrade. The information provided is a guide only.
The Australian Trade and Investment Commission – Austrade – contributes to Australia's economic prosperity by helping Australian businesses, education institutions, tourism operators, governments and citizens as they:
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Austrade provides information and advice that can help you reduce the time, cost and risk of exporting. We also administer the Export Market Development Grant Scheme and offer a range of services to Australian exporters in growth and emerging markets.
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