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Friday, May 20, 2022

Chevron pulls out of Burma due to deteriorating human rights

PARIS — Total Energies and Chevron, the world’s two largest energy companies, said Friday they were leaving Burma (also known as Myanmar), citing rampant human rights violations and deteriorating rule of law after the country’s military toppled the elected government in February.

The announcement comes just a day after the French company called for international sanctions against the oil and gas sector, which remains one of the military government’s main sources of funding. It also came a month after the Associated Press article about the growing pressure on oil and gas sanctions on both companies and resistance from the United States and France.

Total and Chevron have come under increasing pressure over their role in managing the Yadana offshore gas field, along with Myanmar’s state-owned oil and gas enterprise (MOGE) and Thailand’s PTT Exploration & Production. Total owns a majority stake in the business and manages its day-to-day operations, while MOGE collects revenue on behalf of the government.

Total said it expects to complete its exit within six months. Chevon did not provide a time frame for what it called a “planned and orderly transition that would lead to exit.”

“The rule of law and human rights situation in Myanmar has clearly deteriorated over the months, and despite civil disobedience movements, the junta has maintained power, and our analysis shows that, unfortunately, this is for a long time,” Total said.

After seizing power, the military brutally cracks down on dissent, kidnapping young men and boys, killing medical workers and torturing prisoners.

A former Total employee in Burma who has spoken out against the company’s ties to the military government said she was shocked but pleased by the decision, although she admitted it would be difficult to find work elsewhere.

“For employees who still work at Total, this is bad news, even if they oppose the dictatorship or fight the military. But for me, as an ordinary person, and not as an employee, I will say that this is great news, ”she told The Associated Press on condition of anonymity because she feared government reprisals.

Total said it would exit without financial compensation and turn its interests over to other interested parties.

About 50 percent of Burma’s foreign exchange comes from natural gas revenues, with MOGE expected to earn $1.5 billion from offshore and pipeline projects in 2021-22, according to a Burmese government forecast. Previous rounds of US and European sanctions against the Burmese military have not included oil and gas. The Yadana field supplies gas to Burma and neighboring Thailand.

In a statement released shortly after Total’s announcement, Chevron said it too plans to exit “in light of the circumstances.” The company condemned the human rights violations and said it would comply with any international sanctions.

Human Rights Watch welcomed these decisions.

“The next step is to ensure that gas revenues don’t continue to fund these atrocities,” said Ken Roth, the organization’s chief executive.

Thai company PTT Exploration & Production said it was exploring its options, prioritizing “the energy security of Thailand and Myanmar and preventing energy demand from impacting people’s livelihoods in both countries.”

The Yadana field is expected to be depleted in the next few years and is nearing the end of production. Two companies had previously suspended dividend payments on a project in Burma. But the decision had a limited impact on any revenue flowing into MOGE or the military-controlled government.

Lori Hinnant

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