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Bangladeshi Company Begins International Consortium Negotiations for a Tri-nation Gas Pipeline

Narinjara News
26 May, 2005

A Bangladeshi private company held a press briefing in a hotel in Dhaka on 23 May regarding their negotiations with an international consortium about a tri-nation (Burma, Bangladesh, India) gas pipeline.

The press briefing was held under the Mohona Holdings Ltd, a private company of Bangladesh. There were several leaders of the company, including Dr Mizanur Rahman Shelly, in attendance at the ceremony.

The company is now negotiating with potential investors from private and public sectors and financial institutes to set up an international consortium for financing the tri-nation gas pipeline.

The government of Bangladesh, however, has yet to give any signal to go ahead with the project, said a report.

"We have started negotiations and we will let you know later who will be joining the consortium," AB Ahmed, Managing Director of Mohona Holdings Ltd told reporters during the press briefing at the Dhaka Sheraton hotel.

Though the Bangladeshi government has not yet given the go ahead for the project, the company has already started negotiations for its financial package with some Indian and Korean firms.

AB Ahmad said the gas pipeline project will be funded by an international consortium which will build and operate some 897 km of pipeline, 289 km of which will be in Bangladesh.

The construction cost is estimated at US$ 974 million but the total project cost including the gas flow to the pipeline will amount to about US$1.3 billion. The Bangladeshi commitment will require an investment of US$ 350-600 million, the Managing Director said.

He also said that the pipeline will create US$ 600 million of revenue, and that the country will receive another US$ 100 million annually as wheeling and US$24 million in service charges for the payment for gas transmission.
The gas pipeline may run from the Burmese western state of Arakan to Mezoram and the Tripura state of India. Following, it will enter Bangladesh at Brahmanbaria and continue to the Kolkatta region of India.

"It may also come through Teknaf, opposite the Maungdaw side of Burma, and run along the coast of Feni town to Brahmanbaria. It will cross the Jamuna river and pass through Jessore to enter West Bengal at Bongaon," He added.


Tri-nation gas pipeline-Negotiations for int'l consortium begin

News from Bangladesh
25 May, 2005
link to this article.

A local private company, Mohona Holdings Ltd, has begun negotiations with potential investors from private and public sectors and financial institutions to set up an international consortium for financing the planned tri-nation Myanmar-Bangladesh-India gas pipeline project.

Though the government is yet to give green signal to go ahead with the project, the company has already started negotiations for its financial package with some Indian and Korean firms, it is learnt.

"It's confidential at this point of time... We have started negotiations and we'll let you know later who're joining the consortium," AB Ahmed, Managing Director of Mohona Holdings Ltd (MHL), told reporters at a local hotel yesterday. Ahmed said that his company was working as facilitator to the pipeline project.

Ahmed said the gas pipeline project, a public and private sector venture, will be funded by an international consortium. The international consortium will build, own and operate some 897 kms of pipeline covering 289 kms in Bangladesh territory. The cost is estimated at US$ 974 million, he said.

Ahmed said the project is the brainchild of a Bangladeshi and if it is materialised than the three nations will be benefited equally

Ahmed told the journalists that if the pipeline is drawn through Bangladesh it would require an investment of US$ 350-600 million for Bangladesh portion.

Replying to a question whether they know about the conditionalities set by Bangladesh to India for installing the pipeline through Bangladesh territory, he said, "these are the matters which Dhaka and New Delhi are discussing to reach an agreement".

This project is a commercially viable one and it needs to be implemented for the benefit of all the three countries, KB Ahmed said.

Chairman of the Mohona Holdings Dr Mizanur Rahman Shelly also spoke on the occasion. Maj Gen Ruhul Alam Chowdhury, Shamsul Alam, Khalilur Rahman Chowdhury and Pervin Ahmed were present.

The pipeline would cost about US$ 974 million. Taking into consideration the cost of developing gas fields in the offshore waters, the total project cost including gas flow to the pipeline will be about US$ 1.3 billion.

KB Ahmed also said about US$ 600 million investment will come to Bangladesh as cost of the pipeline construction, while the country will receive another US$ 100 million annually as wheeling charge and US$ 24 million service charge for payment to GTCL for gas transmission.

He said according to their proposal the gas pipeline may run from Myanmar to Mezoram and Tripura and enter Bangladesh at Brahmanbaria point.

"It may also come through Teknaf and run along the coast of Feni to Brahmanbaria to take gas from Tripura. In the Bangladesh portion, it will cross the river Jamuna and pass through Jessore to enter West Bengal at Bongaon point," he added.

Another option is that it will enter Bangladesh at Teknaf along the coast to Feni through Brahmanbaria where a spur line from Tripura can be connected with the gas fields of Tripura. The crossing of Jamuna River to Jessore and Bongaon segment will remain unchanged, he said.

Ahmed hoped the bilateral trade issues between India and Bangladesh relating to the gas pipeline project will be ultimately resolved to everybody's satisfaction. "The three nations would soon sign an MOU to this effect", he hoped


Daewoo International signs $12m Myanmar e-government deal

Kim So-young
Korea Herald
May 23, 2005
Link to this article.

A consortium led by Daewoo International Corp. has signed a $12 million contract with Myanmar to computerize the Southeast Asian country's government ministries and interconnect them with high-speed Internet network.

Daewoo International, Korea's leading global trading and investment company, said yesterday that its consortium with database management system provider KCOMS Ltd. won Myanmar's large-scale project to build a e-governance system over the coming year.

The consortium will establish a network infrastructure for the country's central government, link its 38 government ministries to the network and computerize its personnel management system.

"As we have secured the first part of Myanmar's grand e-governance plan, this will have a positive impact on our potential to win subsequent contracts in the country and also enter other Southeast Asian markets," Daewoo International President Lee Tae-yong said.

"This development will also serve as a crucial stimulus for the depressed domestic IT industry, by demonstrating that local IT technologies could make inroads into the potentially huge Southeast Asian market."

Daewoo International currently is leading an oil exploration project off Myanmar jointly with Korea Gas Corp. and two Indian companies. In January, the company, which holds 60 percent share in the project, said it found a 93-meter gas layer.

The company is also part of a Korea National Oil Corp.-led gas field development project in Vietnam as well as an LGN project in Oman, also led by KNOC.

On the back of stable growth in overseas sales and thriving energy business, the company's 2004 sales and operating profit rose 21.5 percent and 23.1 percent respectively over the previous year to 5.01 trillion won and 96 billion won.

Daewoo International shares have risen more than 32 percent this year, reaching 13,500 won at Friday's market close.

Daewoo International is a former unit of now-defunct Daewoo Group, which collapsed under a mountain of debt after the 1997-98 Asian financial crisis. The company graduated from a debt workout program in 2003 and has been making steady improvement.


Three Hydro-Power Plants Are Being Built in Arakan

Narinjara News
May 12, 2005 to this article.

Though three power plants are being built by the Burmese military junta in Arakan State, western Burma, people of the state have little faith that these plants will be of much benefit to them them, said an Arakanese community leader from Akyab.

"Building power plants is very good for Arakan since its electricity infrastructure is very poor. However, these plants are being built where there are military bases. I don't believe these plants are aimed for the benefit of the people. These plants are for the benefit of the military forces and their families," he said.

One of the projects is in Ann Township where the regional military base, the Western Command Headquarter and at least five battalions and one brigade are based.

Ann Chaung Creek hydro-power plant will be 3.5 miles north-east of Ann, and have a capacity of 53 million kilowatt per hour each year after completion.

Another plant is also being built in Sandoway (Thandwe). Sandoway is a tourist with a well-known sea beach, Ngapali.

A local resident believes that this power plant is targeting the tourist sector, which is solely controlled by the military personnel and their families. She said that the benefit that ordinary people will receive from the plant will be minimal.

The Sandoway plant will generate 318 million kilowatts per hour each year.

A similar power project is also about to begin in the southern most township of Arakan State, Gwa, where another famous beach resort, Khaung Tha, is in proximity.

In 1989, the junta also attempted a well-publicized hydro-power project at the Sai Dunn Water Fall, in Butheedaung Township. This project claimed that the whole of Arakan would be lit with electric light. However, ! the project was withdrawn 3 years later without any explanation.

Sai Dunn Waterfall is the biggest waterfall in Arakan State, and Arakanese people popularly believe that it is the greatest source of hydro-power in the State. Every government, including the last democratically elected U Nu's, tried to woo the people with a promise of building a power plant at this location.

The junta has been using propaganda to talk up of overall development of the State, however only factitious infrastructures have been developed. With electricity available only two hours a day and three days a week even at the capital of the State, Akyab, the people of Arakan are longing for a reliable power supply.

People of Arakan are happy about the news of the power projects. However, they do not believe that they will really be benefiting from them, the community leader concluded.


A Pro-Democracy Foreign Policy?

From The Korea Times
May 9, 2005
link to this article.

South Korea has distinguished itself as a precious example of what other Asian nations yearning for democracy can accomplish. Seoul should, therefore, take a leadership role on democracy in Asia.

To do so, however, South Korea must first change its foreign relations with the military dictatorship in Burma (called Myanmar by the regime), to reflect the commitment Koreans have shown through their long struggle for democracy.

The European Union and the United States have imposed sanctions against the government in Rangoon. In all except humanitarian exchanges, they will not have anything to do with the military junta running the country. It is this international condemnation that gives conscientious members of the Association of Southeast Asian Nations (ASEAN) persuasive leverage over the junta.

So much so, that when ASEAN met in the Philippines in April, they debated whether to deny Myanmar the rotating presidency, because of its embarrassing brutality against its citizens and its insincere negotiations with the opposition National League for Democracy (NLD).

It is true they failed to deny the junta the rotating chair. But the fact it was debated at all was a step in the right direction. After all, ASEAN countries are bound by a long-held policy of non-interference into the internal affairs of member states for complicated institutional and historical reasons. The value of not intervening into the internal matters of another country essentially made it possible for the nations of Southeast Asia to build the regional body in the first place in 1967.

But Seoul is not bound by that history. In fact, if it joins with the EU and U.S. in ratcheting up the pressure on Myanmar, an effective two-track approach could be forged _ hard pressure from outside ASEAN and soft persuasion by the Philippines and others from inside it.

There is another reason for Korea to pressure Burma on the issue of democracy. Burma and Korea share a common history: robust pro-democracy movements in the 1980s.

But where Korea transitioned into democracy, Burma regressed. In fact, in 1988, nearly 3,000 people were massacred during nationwide protests. Despite NLD activists being killed and its offices smashed, the organization and its leader became more popular.

In 1990, Burma had its first democratic elections ever, both because of the irrepressible popularity of the NLD and Aung San Suu Ky, and because of international pressure. Aung and her party won in a landslide. But the junta ignored the results and tightened its grip on power.

Now, international pressure must be redoubled, and Seoul should lead the effort in Asia. Burma is under the grip of a regime of brutal repression, including violence against religious and ethnic minorities, forced relocation, beatings, child labor, rape and murder. An Australian doctor working for the human rights group Christian Solidarity Worldwide said he saw signs of chemical weapons being used by the military in their attacks on rebels near the border of Thailand.

Burma is as bad a human rights offender as North Korea, yet it does not get the attention of many so-called human rights NGOs in South Korea. Despite minor steps to placate international pressure, nothing has changed in the way the Burmese junta treats its citizens. A high number of political prisoners remain locked up, including Nobel Peace Laureate Aung San Suu Ky. Forced labor is still routinely utilized by the military.

In January 2005, the International Confederation of Free Trade Unions (ICFTU) reported what the Burmese junta buys with the income its gets from trade. Over 40 percent of its national budget goes to weapons. The report also highlights what the government does not do with the revenue, spending a paltry 0.3 percentage point of GDP on health care.

While overall investment into the country has been decreasing, Daewoo International Corporation is investing in Burma to profit from its oil and natural gas resources that remain virtually untapped, in part due to international economic sanctions imposed on the brutal regime in Rangoon.

Have South Koreans forgotten the dark days of their history, of the dictatorship and oppression they suffered under Park Chung-hee, Chun Doo-hwan and Roh Tae-woo? Have they forgotten the help democracy activists received from the U.S., Japan and Europe? It is high time for Asian democracies, particularly South Korea, to step up to the plate and help nurture liberal movements in Asia.

For starters, Seoul should loosen restrictions on asylum seekers from Myanmar. The National Assembly should pass a law prohibiting firms like Daewoo from doing business there and restrict the assets of firms from Myanmar and their finances in South Korean banks. Seoul should also implement a travel ban on Burma’s top leaders and their families from vacationing in South Korea.

The South Korean government should then aggressively push for cooperation with other Asian countries, particularly Japan, which is also doing business there, on the diplomatic front with the aim of forming a united policy in support of democracy in Burma.

South Korea should lead an Asia-backed ban on trade, prohibiting the import of Burmese textiles. That is what the government in Burma fears most. The BBC reported that Burmese economists estimate it would shut down the country's garment industry, consisting of firms by-and-large privately owned by military officials.

In addition to Seoul’s economic prowess and cultural influence, South Korea’s flourishing civil society and its shining example of creating democratic governance out of the arbitrary oppression of dictatorship make Korea a liberal beacon for Asian people everywhere. It is time for the political leadership in Seoul to extend that possibility to Burmese struggling for as bright a future in their society.

After all, if the democracies in Asia do not do more to support and encourage democratic movements in their region, who will?


Myanmar signs energy concession contracts with Indian firm

From Kyodo News Service/Burmanet
May 9, 2005
link to this article.

Myanmar has signed energy contracts with Essar Oil Ltd., allowing the Indian company to explore for oil and natural gas at offshore and onshore blocks in western Rakhine State, official media reported Monday.

Hsan Lwin, managing director of the state-owned Myanma Oil and Gas Enterprise (MOGE), and Essar Oil Managing Director A. N. Sinha signed production-sharing contracts Saturday for the exploration in the offshore block A-2 (off the western Rakhine coast) and the onshore block L (in the Rakhine coastal region), the New Light of Myanmar reported.

Energy Minister Brig. Gen. Lun Thi, Minister for Social Welfare, Relief and Resettlement Maj. Gen. Sein Htwa, Attorney General Aye Maung, Indian Ambassador to Myanmar R. K. Bhatia and Essar Oil President A. N. Sinha witnessed the signing ceremony at the Sedona Hotel in Yangon.

The report did not further elaborate on the contracts.

Essar is the first foreign company to sign an onshore oil and gas production agreement with Myanmar since the government announced in March that all onshore blocks would be reserved for MOGE in the future.

It was not immediately known how Essar won the contract for the onshore block despite that ban.

The last time Myanmar awarded a production-sharing contract for onshore exploration was in January this year to a Chinese-Singaporean consortium.

According to MOGE, the offshore block A-2 won by Essar, covering more than 1,336 square kilometers, is adjoining in the west to block A-1, which holds a commercially viable natural gas reserve of up to 11 trillion cubic feet.

The block A-1 has been undertaken by South Korea's Daewoo International Corp. in partnership with three other foreign oil companies since 2000.

The Daewoo holds a 60 percent stake in the A-1, while (South) Korea Gas Corp. 10 percent, India's ONGC Videsh Ltd. 20 percent and Gas Authority of India Ltd. (GAIL) 10 percent.

Myanmar has signed dozens of oil and gas exploration and production contracts with foreign companies, mostly for offshore gas operations, since the country began to allow foreign investment in 1988.

Myanmar has 46 onshore oil and gas fields, and 25 offshore fields, according to Myanma Oil and Gas Enterprise.

About 40 percent of the country's export earnings come from natural gas exports to Thailand.



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