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Trafigura-backed Puma Energy eyes Myanmar expansion

Puma Energy, the fuel storage and petrol station business backed by Swiss commodities trading house Trafigura, wants to expand in Myanmar across a range of fuel and petroleum products after opening a $100m storage facility at the southern port of Thilawa.

The new terminal, with a capacity of 91m cubic metres, opens the prospect of using Myanmar as a regional supply hub for neighbouring countries as well as expanding its business in the frontier market, Puma Energy said.

Rob Jones, Puma Energy’s chief operating officer for Asia-Pacific and the Middle East, said: “We have sized the infrastructure so it could be part of a regional hub. The focus is developing the local market — [but] we see the opportunity to use Yangon as a centrepiece for regional flow.”

The move highlights the activity in the energy sector in Myanmar, as the once-isolated dictatorship’s opening reveals opportunities from offshore exploration to supplying the needs of the fast-growing frontier economy. A Chinese-backed oil pipeline on Myanmar’s west coast launched operations last month, offering China a link to the Bay of Bengal and international trade routes west.

Puma’s new Myanmar storage facility and jetty allows the company to bring in bigger supply vessels, reducing its costs and ensuring a more reliable supply. 

It will be used for a range of products from jet fuel to petrol and gas oil, which is widely used in agricultural machinery. The Thilawa area, where the facility is located, is Myanmar’s flagship zone for foreign industrial investment, with bespoke infrastructure part-funded by Japanese public and private money.

Myanmar’s transition to civilian-led government after almost half a century of military rule has attracted great corporate interest because of its strategic position at Asia’s crossroads, bordering both China and India.

The country also has longstanding energy supply shortages after years of poverty and the neglect of infrastructure, particularly in the rural areas where much of the population lives.

Puma Energy struck a deal in 2015 to be the sole foreign distributor of jet fuel in Myanmar. The company is now looking at further expansion, including extending its supply chain through the country, and providing lubricants and LPG, which is used for cooking and heating in Myanmar.

Puma Energy has also established 24,000 cubic metres of bitumen storage at Thilawa, anticipating a growth in demand as Myanmar builds up its road network. The company began operations in February at Thilawa, where it operates through a joint venture with a local company, Asia Sun Energy.

Mr Jones said: “The market here in Myanmar has been slowly liberalising. Recently, the government introduced a new foreign investment law and fully liberalised the market. We have been a little bit in advance of that trend.

“We see a huge growth opportunity — strong growth in demand for fuels across the board.”

Puma Energy, which has grown rapidly in emerging markets from Africa to Latin America, is backed by Geneva-based commodities trader Trafigura, which has a 49 per cent stake in the business. Sonangol, Angola’s state oil company, has a 30 per cent stake.

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