26 April 2022

The Anti-Corruption Commission has formed an investigation team to take legal action following a complaint regarding corruption in the production and sale of coal required for the Tigyit coal-fired power plant in the Ministry of Electricity and Energy's electricity production industry.

Based on the findings of the investigation team, No1. mining Enterprise of the Ministry of Natural Resources and Environmental Conservation, along with a private company, are involved in large-scale Tigyit coal production. The state holds a 30% share, while the private sector holds a 70% share of the production. 

The (2%) mineral tax, which is to be paid to the state during the production process, must be calculated and collected based on the annual sales price of one ton of mineral production (48,100 kyats per ton in 2018-2019, and 56,500 kyats per ton from 2019 to 2022). However, based on the decision made during the Ministry Management Committee Meeting 1/2017 held on 12-1-2017, the price of coal production was calculated using only a price of 12,000 kyats per ton. From 2018 to 2021, over 1,900 million kyats in mineral tax were collected for an annual coal production of over 23,000 tons, which falls more than 14,000 million kyats short of the 30% production ratio that the state should receive. As a result, the state has incurred a total loss of over 15,900 million kyats.

Criminal cases have been opened against former Union Minister U Ohn Win of the Ministry of Natural Resources and Environmental Conservation under section 55 of the AC Law. The cases also involve the former executive director of no 1 mining enterprise, U Kyaw San, who was responsible for supervising the implementation of the work, and the company president, U Chit Khaing, accused of collaborating to cause national damages under section 55/63 of the AC Law.

The power generation industry of the Ministry of Electricity and Energy, along with the private company, failed to comply with Directive No. 1/2017 from the President's Office while signing the contract for coal purchase. When calculating the price per ton, the production amount was not based on the contract's normal production, which has a delivery capacity of 2,000 tons per day. Instead, the calculated production was only based on 1,750 tons per day.

As a result, the price per ton increased due to the lower calculation, resulting in an additional cost of 5,809.12 kyats per ton. Therefore, considering the 1,400,000 tons purchased by the department from 2019 to 2021, the total loss incurred amounted to over 8,200 million kyats. This calculation takes into account the income tax that the company was supposed to pay per ton, which totaled over 1,200 million kyats. Because of that, the state suffered a total loss of more than 9,400 million Kyats.

Based on the findings, criminal action has been taken against former Union Minister U Win Khaing and former Deputy Minister Dr. Tun Naing of the Ministry of Electricity and Energy for their involvement under Section 55 of the Anti-Corruption Law. U Than Naing Oo, the executive director of the electricity industry responsible for implementing and supervising the contract's terms, and U Win Min Khaing, the managing director of the company who collaborated in causing state damages, have been implicated under Section 55/63 of the Anti-Corruption Law. On 25-4-2022, First Informant Report was filed at Phayar Kone Myo Ma Police Station in Ottara Thiri Township, Nay Pyi Taw. And further proceedings are underway regarding this matter.