Oil pipeline In December 2008, China and Burma signed a deal to construct an oil pipeline at Kyaukphyu. On 30 November 2010, the
China Development Bank and Myanmar Foreign Investment Bank signed a $2.4 billion loan deal to construct the
pipeline from Kyaukphyu to
Kunming in
Yunnan province, China. The pipeline is expected to be completed in 2015 and capable of transporting 400,000 barrels of oil per day. The oil pipeline was completed in August 2014.
Natural gas pipeline and terminal Separately, as reported by the
Financial Times in February 2013, nearly 2,000 workers are finalising close to Kyaukphyu, a major natural gas projects, the Shwe gas pipeline and onshore terminal. This terminal and pipeline are being built by South Korea's
Daewoo International in a consortium with state-owned
Myanmar Oil and Gas Enterprise (
MOGE) and others. From May 2013, this pipeline is planned to pump about of natural gas annually, most of which will also go to China via nearby Maday island. These oil and gas
Sino-Burma pipelines projects are supervised by a Myanmar "
Kyaukphyu Special Economic Zone" agency and are estimated to use about U$3bn of investments and to have the potential of creating over 200,000 jobs, while additional capital will be required to develop a port for dry containerized and bulk cargoes, as well as a railway which will link Kyaukphyu to Kunming, in Yunnan. The Myanmar section of the gas pipeline was completed on 12 June 2013 and gas started to flow to China on 21 October 2013.
Special Economic Zone and its impact Myanmar government officials have stated that these massive projects will be conducted with enhanced consultation with the local population. In this respect, there has already been protests by some locals against the consequences of some of these projects, such as potential impact on fishing or land confiscations which may be conducted by authorities for these terminals and pipelines. A December 2012 report by the "Arakan Oil Watch" organization about plans to build a special economic zone near Kyaukphyu on Ramree Island in Arakan State, claimed it would "endanger the health of thousands of people and destroy Myanmar's second largest mangrove forest". The report, titled "Danger Zone," states that around 40 villages would be adversely affected by the project, which would use 120 km2 of pristine coastline. At the end of December 2015, the Myanmar government announced that it had chosen a consortium of mostly Chinese companies to develop a special economic zone and a deep-water port, as a result of a tender initiated in 2014 for an industrial park and a deep-water port to be built and operated as public–private partnerships. The selected Chinese-led consortium won over a dozen other bidders to win the development rights late last year. The six companies in the consortium include China state-owned groups
Citic (finance),
China Harbour Engineering, China Merchants Holdings (International), TEDA Investment Holding, Yunnan Construction Engineering Group (YNJG), and the
Charoen Pokphand Group, a Thai conglomerate. CITIC and the six other investing firms will hold an 85 percent stake, with the Burmese government taking the rest. While
China Harbour Engineering is a well-known engineering firm for designing and building deep sea ports, the
China Merchants Group, through some of its affiliates (
China Merchants Holdings (International),
China Merchants Group, both listed on the Hong Kong stock exchange, and
China Merchants Energy Shipping) is a global operator of ports as well as of oil tanker and dry bulk ships which has been approved to absorb in 2016 another Chinese state-controlled tanker and bulk ships operator,
Sinotrans Shipping. By 2025, the consortium plans to build a roughly 1,000-hectare industrial park and Myanmar's highest-capacity port, with facilities able to handle 7 million 20-foot-equivalent-units (TEU) of containerized cargo per year. Total project costs are estimated to be in the range of several billion dollars. The projects are said to lead to the creation of some 100,000 jobs. Some analysts claim that the Kyaukphyu deep-water port has a strategic dimension as part of China's
Belt and Road Initiative and
String of Pearls strategy. The Kyaukphyu port and Special Economic Zone (SEZ) is one of three major port and coastal development projects in Myanmar, together with the
Thilawa zone near
Yangon, the country's most populous and economically developed city, and the
Dawei zone in the south-east, near the Thai border, all of which have attracted major financial and industrial interests. ==Transport==