Posted in Legislative Analysis, Political Institutions on Aug 21, 2019

On 13th August 2019, the Petroleum Testing, Drilling and Processing Bill was introduced to the Pyidaungsu Hluttaw by the Ministry of Electricity & Energy.

Current status (22/08/19): Pending decision on date for discussion from Joint Bill Committee


Bill in brief

The main objective of this Bill is to being petroleum testing, drilling and processing in line with national energy policy.

Summary of main provisions

  • A Petroleum Industry Monitoring Central Committee will be formed by the Union Government, along with responsibilities – determining the block boundary, scrutinising permit applications and processes for transparent bidding, and approving the Development and Production Plan of the permit holder.
  • Following agreement of the Central Committee, the Ministry of Electricity and Energy can issue announcements regarding boundaries of onshore and offshore blocks with the consent of the Union Government. Reserved blocks can also be included for access only by Myanmar. Before the announcement, the public must be informed, and an Inspection Committee can be established for compensation of local people’s rights and benefit and for reviewing boundary.
  • The Ministry is responsible for:
    • transparency and integrity of tender regulations
    • administration of Myanmar Oil and Gas Enterprise (MOGE) and its partners
    • permission and rejection of permit extensions
    • public awareness about contracts, instructions and procedures
  • The Ministry can allow MOGE to conduct any activities relating to the petroleum industry supply chain in reserved blocks. With the permission of the Ministry, MOGE can extract itself but also work through cooperation with another company/organization, with the consent of the Union Government. • There is a management procedure for regulation of the contract by the permit holder. Moreover, for the conduct of petroleum industry without permit, the distorted report and the disturbing of the industry, penalties exist. • The permit holder must pay 12.5% of total value or amount of crude oil and natural gas produced to the union budget, whether by cash or petroleum.

Possible Impacts

A brief review suggests this Bill could have the following impacts of interest to civil society groups:

Positive Negative
Open tender for the permit of petroleum industries could bring transparency and lower the risk of corruption. Although information about contract and the amount of potential petroleum will be released, a lack of transparency surrounding other sources of industry data remains.
  The formation of Inspection Committee, which will investigate harms to local people in the allocated bock boundary, should enable CSO participation.

Other relevant legislation

• Petroleum Hand-dug Well Law 2017

• Petroleum and Petroleum Product Law 2017

Links

Bill Text

MEITI: https://myanmareiti.org/en

NRGI: https://resourcegovernance.org/our-work/country/myanmar

Global Witness: https://www.globalwitness.org/en/campaigns/myanmar/

Contact

Moe Aung, The Ananda, moeaung@theananda.org