Sunday, July 23, 2017

Energy and electricity merger complete

A merger between the ministries of electric power and energy, ordered by the new government in March, is now complete and the new structure will be submitted to the cabinet for approval, officials said.

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Permanent secretary U Htain Lwin said yesterday that operational changes and job cuts have been minimal.

“There are no big changes in the merger. The day-to-day operations of our ministry will continue as usual,” he said.

“A new division will be created at Myanma Oil and Gas Enterprise – that is the only change. We are trying to get this approved by the cabinet. All other departments and enterprises under the ministry will be the same as before.”

The new division is a reincarnation of MOGE’s Energy Planning Department, responsible for energy policy formulation and management, which was disbanded last year.

The Ministry of Electricity and Energy will be a heavyweight in the new government, handling important projects including electrification and oil and gas, and will be expected to narrow the country’s energy gap while managing controversial foreign investments.

It will play an important role for foreign businesses, representing more than 60 percent of pledged foreign direct investment into Myanmar.

U Pe Zin Tun will head up the new ministry. The former Ministry of Energy permanent secretary was named Minister for electricity and energy in April, replacing Daw Aung San Suu Kyi who briefly held the role.

His appointment met with a mixed response – some were concerned that he did not have the technical knowledge for the post, while others praised his clean reputation.

U Htain Lwin, permanent secretary of the now-defunct Ministry of Electric Power, is now permanent secretary for the combined ministry.

“The two ministries had two permanent secretaries – one became Union minister while the other became permanent secretary of the new ministry. It is fair play,” said an official from the former Ministry of Electric Power.

Deputy permanent secretaries at the former ministries have not been granted new titles.

“They are still in their old roles. They will probably manage departments related to their former ministries, as there will be no new appointments of high-ranking officials,” the official said.

The new ministry has over 37,000 staff and is permitted to employ up to 66,000. No job cuts have yet been made, he added.

“No ministry except education, health and the police force [under the Ministry of Home Affairs] will be allowed to appoint service staff of more than 60 percent of the quota under the previous government, though this has not yet been announced,” the official said.

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The Ministry of Electricity and Energy will regulate major sectors for foreign investment. Since the planning ministry first began tracking pledged foreign direct investment in 1988, oil and gas represented 35.17pc of the total and power accounted for 30.89pc until end-March 2016, according to ministry data.

The oil and gas sector represents 40.22pc of actual foreign investment, while the power sector represents 25.56pc, according to Directorate of Investment and Company Registration (DICA) figures.

A total of 52 hydropower projects and 11 coal-fired power plants, as well as gas-fired and renewable power projects were approved by the previous government.

The country has set a target of 100pc electrification by 2030 while only 30pc of the population now has access to electricity.

Myanma Oil and Gas Enterprise, the country’s main regulator for the upstream industry will have to handle more than 100 production sharing contracts in onshore and offshore blocks.

A total of three onshore and offshore bidding rounds were held by the previous government.

Several ongoing joint venture projects between foreign companies and Myanma Petrochemical Enterprise and Myanma Petroleum Products Enterprise are not yet finished, but will continue uninterrupted under the new government, U Htain Lwin said.