On December 9-10, 2021, the first of two Summits for Democracy will take place in the United States with the aim of setting forth an affirmative agenda for democratic renewal and to tackle the greatest threats faced by democracies today, including corruption, through collective action. Corruption in the oil, gas and mineral sector undermines the efforts…Read Download
Financing the Military in Myanmar: Analysis of Gas Revenues
Since seizing power in February 2021, the Myanmar military has faced widespread allegations of human rights violations. Companies operating in Myanmar must make challenging decisions about how to responsibly navigate the crisis. International oil companies, including energy majors Total and Chevron, are under particular scrutiny as the military regime continues to sustain itself with revenues from the offshore gas industry.
The contracts in force are complex, as are the payment structures. While Total and Chevron have suspended some gas dividend payments, these are a fraction of what is reaching the military regime. 90% of the money continues to flow.
Using publicly-available information, this Publish What You Pay policy brief summarises how revenues are flowing from international oil and gas companies through the state-owned Myanmar Oil and Gas Enterprise (MOGE), and on to the military. Since the attempted coup, these revenues are more likely than ever to be a direct source of finance for the Myanmar military. The following highlights these key findings:
- MOGE has entered into four joint ventures as a representative of the Government of Myanmar for four offshore gas projects, including the Yadana Project operated by Total.
- Following the attempted coup d’etat, the military has control over all government bank accounts, including MOGE’s accounts.
- In 2017-2018, the amount that MOGE collected from projects under the responsibility of Total amounted to almost USD 400 million.
About 50 percent of Myanmar’s foreign exchange now comes from gas revenues, indicating a high likelihood that the military is relying on them. The brief encourages oil and gas companies to pay revenue owed to MOGE into a trust or protected account until a legitimate and democratically-elected government is in place in Myanmar.
Total’s response to this report
This report focuses on payments made to MOGE as a result of the Yadana Project operated by Total. Total has said publicly that it does not make payments to MOGE and that this is done by PTT. This briefing uses publicly available information to explain the complex contracts and payment structures at play, and what Total’s role is. We shared this briefing with Total prior to publication and it provided this statement. We invited Total to disclose further supporting documents publicly to clarify its position but it did not.