Military regimes the world over rely on their wealth of natural resources to finance military expenditures and subsequently sustain their hold on power. Be it tropical forests, gold, copper and diamonds, or oil and gas, without production and extraction deals with multinational corporations, most military regimes could not stay in power.
The demand for Burma’s natural gas, and its strategic position to trade markets in China and Southeast Asia, has encouraged neighbouring countries, such as India, Bangladesh* and Thailand, to recognise and make deals with the Burmese military.
Possibly more important is Burma’s geopolitical position between India and China, with warming yet distrustful relations between the two Asian giants. Burma has for many years been considered under strong economic influence of China, but India’s recent policy shift to engagement with the regime has put the Burmese junta (State Peace and Development Council, or SPDC) into a highly beneficial bargaining position between the two foes. The Burmese generals do not appear shy in playing one against the other. Since August 2004, the regime has sold two concessions for oil and gas exploration in Arakan State alone to Chinese companies (see news*). An additional plan to build a pipeline to transport oil from the Sittwe port in the Indian Ocean to Yunnan Provice remains high on the Chinese agenda. [a]
Within only weeks of the October 2004 purge of former Prime Minister General Khin Nyunt and his followers (see news) Gen Than Shwe, head of the SPDC, and Soe Win, Burma’s new Prime Minister, each visited India and China respectively. They traveled to provide assurances of stability and further economic agreements between their nations.
As part of the negotiations to produce and import natural gas, the Burmese regime is demanding political concessions from these trading partners, such as the expulsion of Burmese refugees and crackdowns on the pro-democracy opposition.
Although all details regarding the contractual arrangement have been shrouded in secrecy, it is believed that the Burma regime will sell the gas to India and China at similar price level as the current sale of gas from the Yadana/Yetagun fields into Thailand, US$3.70/mmbtu (million British Thermal Units). The total revenue of current estimated recoverable gas (10-14 trillion cubic feet (tcf) for the military regime would then total US$12-17 billion over a twenty-year period, the largest ever injection of foreign currency to the regime.
Considerable signing bonuses and all local profits from any Exploration & Production/E&P projects in Burma go directly to the Myanmar Oil and Gas Enterprise/MOGE,* which is 100% owned by the Burmese military. The regime’s military expenditures account for over 40% of the country’s national budget. [b] UNDP’s 2003 statistics state that Burma’s health and education spending is 0.4% and 0.5% of GDP respectively, each of which rank the lowest of the world. [c]
These gas profits will only strengthen the position of the ruling military and cause further sufferings and hardship for the common people of Burma. The peoples of Burma need your help in preventing this environmental, human, and political catastrophe from going forth.
We, the SHWE Gas Movement, demand that this project be postponed until above four issues receive adequate airing. Until the people of Burma have a say in the dealings of their government, it is up to you to help stop this project.
[b] Andrew Selth, Burma’s Armed Forces: Power Without Glory