The dismantling of equipment at the VPower power plant in Kyaukphyu Township is nearing completion as the facility relocates due to escalating tensions in Arakan (Rakhine) State, local sources report. VPower is a joint venture between the Chinese state-owned China National Technical Import and Export Corporation (CNTIC) and Hong Kong-based VPower Group.
The relocation process began gradually in late 2024, initially relying on cargo ships. But the pace has accelerated sharply as fighting spread closer to Kyaukphyu Town.
“Once the fighting broke out in Kyaukphyu Township, they sped up the relocation. They’ve already moved over 90 generators, and they expect to have everything else out before Thingyan,” a local familiar with the plant’s operations told DMG. Thingyan is Myanmar’s traditional water festival, held in mid-April.
The $140 million facility was designed to generate 150 megawatts (MW) of electricity from natural gas. However, it has struggled to reach even 60 MW due to severe gas shortages.
Under the arrangement, Myanmar provided the land and natural gas, while the Chinese partners supplied the machinery and technology. Myanmar then purchased the electricity in USD, which was fed into the national grid.
Situated in Gonechwein Village, roughly six miles west of Kyaukphyu Town, the plant has faced security risks since clashes between the junta and the Arakan Army (AA) began in June 2025. Heavy fighting has occurred as close as two miles from the facility.
“The relocation’s moving so fast probably because the conflict in Kyaukphyu is so unpredictable. They might be taking the plant apart as quickly as they can to avoid it getting damaged in the fighting,” another local suggested.
The plant originally began operations in late 2020 under the National League for Democracy (NLD)-led civilian government, aiming to supply power to the Kyaukphyu Special Economic Zone (Kyaukphyu SEZ) and the national grid.
Operations halted in 2023 after the coup regime failed to pay for electricity in USD and also did not supply enough natural gas for power generation.
