Government Plans to Ship Fuel From Thilawa to Yangon in a Bid to Slash Transport Costs

The Yangon govern­ment has unveiled a proposal to begin transporting oil and pe­troleum products from Thilawa to Yangon via ship in a bid to reduce transportation costs in­curred by consumers at the pump, a chief minister has said.

Under the proposal small oil tankers, with a capacity of up to 3,000 tonnes, would load up on oil at the Thilawa sea port and transport it to Yan­gon via the Yangon River, Chief Minister U Phyo Min Thein told a meeting at UMFCCI in Yangon.

“We are working on a proposal for this scheme. Even though we don’t have a proper deep-sea port near Yangon, we are working hard to minimize the retail price of fuel in the market as soon as pos­sible,” said U Phyo Min Thein.

The minister didn’t elaborate on the plans.

At the moment trans­porting fuel from Thilawa to Yangon is costly, as it must be done via road using trucks which have a maximum capacity of 7,000 gallons, or roughly 22 tonnes.

A lack of road, rail and port infrastructure in Myanmar means the transportation of goods is difficult and costly and can drastically inflate the costs of everyday prod­ucts.

“Since the government took office, transportation costs have made up 30 percent of the total value of products. Therefore, the regional government is taking the initiative to min­imize fuel-based transpor­tation costs to reduce the burden being passed on to businesses,” he said.

Transporting fuel by truck can carry other problems for consumers. In April the government announced it would crack down on petrol stations found to be selling poor quality fuel.

It’s not uncommon for oil tanker drivers or ser­vice station staff to sell quality fuel and replace it with lower quality fuel in order to earn extra in­come, Dr. Win Myint, secretary of the Myanmar Petroleum Trade Associa­tion (MPTA) told Myan­mar Business Today in a recent interview.

The government also recently unveiled plans to allow foreign invest­ment in petrol stations in Myanmar with interest coming from undisclosed companies in Singapore, the US and other coun­tries.

“Allowing foreign in­vestment in the fuel trade will drop the retail price slightly but compared to the global market price it will still be high,” said U Phyo Min Thein.

Source: Myan­mar Business Today