Cut off payments to Myanmar junta, says Human Rights Watch

DHAKA, Bangladesh

Governments and energy companies should suspend payments to Myanmar's military junta following in the footsteps of Chevron and Total SA, said Human Rights Watch on Friday.

Natural gas revenue is the military’s largest source of foreign currency income, including approximately $1 billion in duties, taxes, royalties, fees, tariffs, and other profits, the New York-based rights watchdog said in a statement.

“Governments and energy companies should follow up a recent decision by Chevron and Total SA to suspend payments from a gas pipeline project in Myanmar with additional steps to cut off funding to the country’s military junta,” it added.

The decision announced by Total and Chevron concerns only a 15% dividend paid by a pipeline company, the Moattama Gas Transportation Company, from profits from transportation fees it earns moving gas from Myanmar’s offshore Yadana gas field to Myanmar and Thailand.

Total said the payments were suspended as of April 1. Total and Chevron together are the majority owners in Moattama, with 31.2% and 28.3% stakes, respectively.

The military-controlled company Myanmar Oil and Gas Enterprise (MOGE), owns 15%, and the Thailand state-owned gas company PTT owns 25.5 percent. Total acts as the “operator” of the Yadana wellheads and Moattama’s pipeline infrastructure.

The suspended payments are dividends to these companies based on their ownership share.

According to Moattama financial records, the company paid MOGE about $38 million in 2018 and approximately $52 million in 2019, indicating that MOGE’s overall gas transportation dividends from gas operations are less than 7% of the overall state revenue from natural gas.

Total’s and Chevron’s statements do not mention the hundreds of millions of dollars in additional tariffs, fees, and tax payments that Moattama pays to Myanmar military-controlled bank accounts.

The statement does not apply to hundreds of millions of dollars more that MOGE receives from its share of revenues from selling gas to PTT.

Total acknowledged the dire situation in Myanmar and suggested in its statement that further action might be taken.

Total condemns the violence and human rights abuses occurring in Myanmar and reaffirms that it will comply with any decision that may be taken by international and national authorities, including applicable sanctions issued by the EU or US authorities.”

Chevron’s statement noted that the company “condemns the violence and human rights abuses occurring in Myanmar. We stand with the people of Myanmar and the global community in urging for a peaceful resolution that respects the will of the people.”

The company said that it would respect sanctions imposed on additional gas revenue but cautioned against them.

“If governments effectively sanction or suspend the natural gas revenue generated for the military junta, it will lose $1 billion a year being used to hurt Myanmar’s people,” said John Sifton, HRW Asia advocacy director.

“That kind of economic impact could put real pressure on the military to stop its brutal repression and return the country to a democratic path,” Sifton added.